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Sunday, Mar 3, 2024

Woodbridge’s Shapiro Sentenced for $1.3 Billion Ponzi Scheme

Robert Shapiro of Sherman Oaks was sentenced Tuesday to 25 years in prison after pleading guilty to conspiracy and tax evasion charges related to his orchestration of a $1.3 billion investment fraud scheme in which more than 7,000 victims suffered financial losses. Prosecutors said Shapiro ran a Ponzi scheme through his company, Woodbridge Group of Cos., which he used to solicit money from investors, primarily seniors, on the basis that their money would be used for high-interest real estate loans. Instead, money from new investors was used to pay interest and dividends to established investors, as well as to bankroll expensive lifestyles for Shapiro and others on his team. Woodbridge was headquartered in Sherman Oaks and had offices in Boca Raton, Fla., as well as Colorado, Tennessee and Connecticut. By funneling money through his network of more than 270 LLCs, prosecutors said Shapiro stole up to $95 million for personal use, including the purchase of a $6.7 million home, a wine collection, luxury jewelry, antique vehicles and chartered plane flights. The scheme ran from at least July 2012 to December 2017, when Woodbridge filed for Chapter 11 bankruptcy and defaulted on its obligations to investors. Losses to investors are estimated at more than $100 million. In November, Shapiro agreed to repay $120 million to resolve civil claims by the Securities and Exchange Commission. Shapiro also pled guilty to tax evasion after failing to pay $6 million to the IRS between the years 2000 and 2005. He was sentenced to 300 months in prison. Upon his release, he will be placed on supervised release for three years. The case was prosecuted by Assistant U.S. Attorneys Roger Cruz and Lisa Miller.

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