A Delaware real estate firm owner pled guilty in federal court to defrauding investors in a $3.3 million Ponzi scheme, the U.S. Department of Justice announced Wednesday.
According to the DOJ, Carl Chen, owner of "Chenmax Properties Inc., a Delaware Real Estate Investment Trust" and part-owner of Re/Max Sunvest Realty Co. pled guilty Tuesday to wire fraud charges.
Between 2013 and 2017, Chen solicited Re/Max clients to invest $3.32 million by fraudulently representing those funds would be used to purchase real estate with an annual interest return of 10 to 15 percent for investors. Instead, he was using those funds to pay off interest obligations for previous investors.
Chen declared bankruptcy in October 2017 and sought to discharge millions in debts owed to those investors.
He'll be sentenced on June 21, 2019, and faces a maximum penalty of 20 years in prison.