NEW YORK – Indian American businessman Nik Patel of Florida was sentenced to 25 years in prison on Tuesday, March 6 in a federal courtroom in Chicago for committing a fraud of $179 million real estate fraud, according to a Chicago Tribune report.
In 2016, Patel admitted to committing a fraud of $179 million by conducting a sale of 26 fake loans to Pennant Management, a Milwaukee investment firm.
According to his plea, Patel submitted these false documents to Pennant showing that a portion of the loans were guaranteed by the U.S. Department of Agriculture but in fact, were actually fabricated and had no borrower, no pre-existing loan and no government guarantee.
Patel then used the cash he made and put it towards his hotel projects in Illinois and Florida as well as into his own lifestyle.
According to a Chicago Tribune report, Patel owned luxury vehicles including a Rolls Royce and a Lamborghini, a private jet which he used to travel the world including multiple trips to Panama where he “blew off steam” and visited brothels, and wore custom suits and jewelry.
In Illinois, the Illinois Metropolitan Investment Fund (IMET), an investment fund popular with local governments, schools and park districts, lost more than $50 million as they had invested in Pennant and more than 200 municipalities, school districts, park districts and other public entities in the Chicago area were affected by Patel’s actions.
Last year, Patel convinced U.S. District Judge Charles Kocoras, to let him remain free on bond while he was awaiting his sentence and said that he would help authorities reclaim the money lost for his victims however, he was actually plotting an escape to Ecuador with his family when he was arrested by the FBI in January, according to an earlier News India Times report.
According to court documents, Patel’s elaborate plan for an extravagant new life in Ecuador included luxury vehicles, a million-dollar home in the suburbs of Quito, a private chef and an English-language school for his four daughters.
Patel was also planning another fraud at the same time as he used the name “Ron Elias” and posed as a vice president of Banco do Brasil to sell more than $19 million in bogus loans to investors in Iowa and even created a fake website and email address to help convince his victims.
With a total of $35 million in ‘dirty money,’ Patel was planning to buy diamonds from Dubai but was caught at Kissimmee Gateway Airport near Orlando on Jan. 6 when he tried to flee the country.
According to court documents, Patel had written a document titled “What we are doing” appearing to be written for an unidentified person who was aiding him in the escape attempt, in which he wrote:
“I have got my final asylum approval and need to move things along and cannot just sit around here and wait any longer. I managed to get a few more dollars (don’t ask how) so as of today, I have a total of $35MM in ‘dirty’ money,” adding that that he was finalizing the purchase of a 104-carat “fancy dark” diamond through a trusted merchant in Dubai as that was “the cleanest way” to hide his money.
Andrew DeVooght, Patel’s attorney, asked Kocoras for a prison sentence of less than 20 years since he had already recovered $86 million in losses, but he disagreed.
The Chicago Tribune reported that Patel was charged with attempting to flee to avoid prosecution in January, but prosecutors dropped that count after he was sentenced last week, before which he stood at the lectern and apologized for his behavior, saying he “would not rest until every penny of what he took had been paid back to his victims.”