Criminal Justice News

Tuesday, June 19, 2012

East Bay Man Sentenced for Multi-Million-Dollar Investment Fraud Scheme

SAN FRANCISCO—Last week, Krittibas Ray was sentenced to 65 months in prison for running a multi-million-dollar fraudulent investment scheme, United States Attorney Melinda Haag announced.

Ray admitted to enticing victims to invest in a promissory note program and in hedge funds he operated by falsely telling them that by placing funds into banks in India he could guarantee returns of 7 percent to 8.5 percent and that the various hedge funds he was operating were profitable. In addition, Ray admitted that he failed to disclose to investors that he was using their money for personal expenses and to pay other investors and that the gains he reported to investors were false. Ray received approximately $3.3 million from investors between February 2008 and December 2011. He used a substantial portion of those funds to pay back earlier investors in his fraudulent scheme.

Ray, 46, of Albany, California, was arrested on December 16, 2011, after he was charged by criminal complaint. On December 29, 2011, a federal grand jury indicted him on two counts of wire fraud, in violation of Title 18, United States Code, Section 1343, and one count of money laundering, in violation of Title 18, United States Code, Section 1957. On March 30, 2012, Ray pled guilty to both wire fraud counts.

The sentence was handed down by United States District Court Judge Susan Illston. Judge Illston also sentenced Ray to a three-year period of supervised release after he is released from custody and ordered him to pay $2,709,540 in restitution to the victims of his scheme.

Ray has been in custody since his arrest on December 16, 2011.

Hallie Mitchell is the Assistant U.S. Attorney who prosecuted the case with the assistance of Elizabeth Garcia. The prosecution is the result of an eight-month investigation by the Federal Bureau of Investigation.

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