California Real Estate Mogul Arrested for Ponzi Scheme

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The California real estate market faces uncertainty after a high-profile Ponzi scheme arrest.

News Summary

Kenneth W. Mason, a 63-year-old real estate mogul, was arrested for allegedly orchestrating a 15-year Ponzi scheme that defrauded hundreds of investors out of nearly $30 million. Facing multiple federal charges including wire fraud and money laundering, Mason misused investor funds for personal gain and sought new investments even after significant financial transactions. Many investors, often retirees, lost their life savings, prompting calls for justice. The impact of Mason’s actions has led to the bankruptcy of his company, LeFever Mattson, and an active investigation by authorities.

California – Kenneth W. Mason, a 63-year-old real estate mogul from Sonoma, was arrested on charges of running an alleged 15-year Ponzi scheme that duped hundreds of investors out of nearly $30 million.

Mason faces multiple federal charges including seven counts of wire fraud, one count of money laundering, and one count of obstruction of justice. The allegations bring serious implications for Mason, who served as the president of LeFever Mattson, a company managing limited partnerships focused on commercial and residential properties.

Investors, many of whom were nearing retirement or already retired, were lured into the scheme with claims that their money was being invested in “legitimate and safe” real estate ventures. Instead, Mason reportedly directed funds towards “off-books investors,” failing to disclose critical details about the investments and partnerships.

Acting United States Attorney Patrick D. Robbins emphasized that many of Mason’s investors were cheated out of their hard-earned money, often losing their life savings. The scheme’s operation is alleged to have continued from 2009 to 2024, expanding its reach over more than a decade.

According to prosecutors, new investors’ funds were used to pay returns to earlier investors, a classic hallmark of Ponzi schemes. Mason continued to solicit new investments even after a significant sale of an apartment complex, which netted over $8 million. While receiving funds from new investors, Mason falsely claimed to be managing legitimate investments.

The fallout from Mason’s actions has been severe. Many victims have already expressed their relief at his arrest, hoping for a measure of justice after experiencing devastating financial losses. The ongoing investigation has led authorities to encourage any additional victims to come forward.

Further complicating the situation, during a Securities and Exchange Commission (SEC) investigation in 2024, Mason was accused of destroying crucial evidence, including over 10,000 deleted files, after being instructed to retain pertinent business documents. His attempts to cover up his illegal activities may compound his legal challenges.

The arrest signals that authorities are taking a firm stand against financial misconduct in the real estate industry. As the investigation progresses, prosecutors allege that Mason misappropriated at least $28 million from investors in specific companies associated with the Ponzi scheme. In addition to facing numerous charges, he could see significant prison time if convicted. Maximum penalties include 20 years in prison per count for wire fraud and obstruction of justice, and 10 years for money laundering.

In the wake of Mason’s arrest, the company he led, LeFever Mattson, has filed for Chapter 11 bankruptcy, indicating the depth of the financial turmoil resulting from his actions. As part of the investigation, authorities are planning to seize properties owned by Mason in Piedmont and Del Mar should he be found guilty of the federal charges.

The investigation into Mason remains active, with law enforcement continuing to unravel the extent of the fraudulent activities. Investors are being urged to remain vigilant and report any further suspicious activity related to Mason and LeFever Mattson.

As cases like this continue to unfold, the repercussions serve as a reminder of the importance of transparency and oversight in the financial sector, highlighting the critical need for investor education and protection moving forward.