The co-founder of a Charlotte property investment firm who last year announced plans to open a bar and restaurant near BB&T Ballpark has pleaded guilty to securities fraud and wire fraud. Frank Enrique Lleras, 30, appeared before U.S. Magistrate Judge David S. Cayer on Wednesday in connection with a fraud scheme from 2012 through 2015.
According to court documents, Lleras was co-founder, executive vice president and chief investment officer of Optimum Property Investments LLC, which scammed at least 20 victims out of nearly $3 million. The company claimed to have offices on North Church Street as well as in Miami, Chile, the Dominican Republic and Colombia. Lleras admitted in court that he lured victims, many in the medical profession in the Dominican Republic, into his scheme by saying the company would purchase distressed or foreclosed properties in Mecklenburg County and elsewhere, then resell them or rent them for profit.
Lleras, whose father-in-law was an anesthesiologist in the Dominican Republic, claimed he would buy the properties in the investors’ names but instead used their money to pay off other debts for Optimum and to purchase property titled to Optimum, not to the individual investors. In Mecklenburg County property records, Optimum is listed as owning four properties with a total value of about $1.5 million. Three of those records list different addresses for Optimum; two of them appear to be nonexistent, according to county records.
He also used some of the money to support his own lifestyle, including buying expensive jewelry and withdrawing large sums of cash from accounts supposedly created in the names of LLCs for the investors.
According to the complaint, investors became suspicious in November 2014 and travelled to Charlotte to check on their bank accounts and the properties. They learned that the bank accounts had little money and the property deeds and tax bills that had been provided as proof of their investments were fraudulent.
He was indicted in December.
The securities fraud charge carries a maximum prison term of 20 years and a $5 million fine, and the wire fraud charge carries a maximum prison term of 20 years and a $250,000 fine. A sentencing date has not been set yet. According to a pending consent order and judgment, he will also forfeit the $2.9 million in proceeds from the investments.
Scott Baughman contributed to this report.