The owner of a Southern California real estate company pleaded guilty to mail fraud recently, after having defrauded investors out of over $110 million dollars. Ten years ago, John Packard, a Long Beach resident, and his partner created Pacific Property Assets in order to invest in apartment complexes in the southwestern U.S.
Things were apparently going well until the real estate market plummeted in 2008. After that, Packard and his partner used the money from new investors to pay earlier investors as well as the company’s debts; effectively turning what was once a legit company into a Ponzi-scheme.
Packard plead guilty to mail fraud, which basically means that an individual used the mail to send or receive any documents related to the commission of fraud. Mail fraud is a serious federal crime, and one does not necessarily have to use the USPS in order to be charged with it. As a matter of fact, even if one uses a private mail carrier in their scheme, he or she can still be charged with, and convicted of mail fraud.
The penalties for mail fraud include a sentence of up to 20-years in federal prison. Because it is a federal crime, someone convicted may not necessarily spend their time in the state prison system. If the fraud includes a federal bank, the maximum sentence is increased to a possibility of 30 years in federal prison.