A California man was sentenced to ten years in state prison for orchestrating a house-flipping Ponzi scheme that cost investors nearly $1 million. William Warren Baker, 59, received the maximum allowable sentence after previously pleading guilty to thirteen felony counts of using untrue statements in the purchase or sale of securities and one felony count of grand theft.
According to authorities, Baker solicited funds from at least ten investors who thought that Baker would purchase, fix up, and sell distressed real estate for a profit. The scheme took place from January 2006 to May 2008, during which Baker took in over $900,000 from investors. Yet instead of purchasing homes, Baker instead used investor funds to pay personal expenses or to satisfy redemption requests from older investors. Baker also purchased property for personal use and transferred it to his wife and son through use of a trust. Authorities uncovered the scheme while investigating the disappearance of Baker's mother, and later charged Baker with stealing more than $6,000 in social security payments intended for her.
In addition to the sentence, Baker was ordered to pay $1.8 million in state fines and $900,000 in restitution to victims of the scheme.