Prominent Sacramento developer charged with allegedly embezzling millions from investors
Prominent Sacramento developer Chris Vrame has been charged in an embezzlement scheme alleging he siphoned more than $4.1 million between 2013 and 2017 from investors in a land purchase deal, court records say.
The state attorney general’s office filed 34 felony embezzlement counts against Vrame late Friday in Sacramento Superior Court that include special allegations of theft of more than $100,000 and excessive loss of more than $500,000.
Vrame is scheduled to be arraigned on the charges Tuesday afternoon, and his attorney said the charges involve Vrame simply “borrowing” money that was later repaid.
“This recently filed case against Chris Vrame involves his borrowing of money from shared business investments several years ago, money which has long since been repaid with interest,” Sacramento attorney William Portanova said. “We look forward to quickly resolving this related matter as well.”
The allegations spelled out in court papers say Vrame took amounts ranging from $5,000 to $500,000 over the years from two entities he controlled - KV Sierra Vista LLC and the Conservancy to Protect the Land - and that investors discovered the scheme when they came across a document in the copy room of Vrame’s business office.
Vrame, a relative of Sacramento megadeveloper Angelo Tsakopoulos and former president of the Del Paso Country Club, created an investor group named SV Baseline LLC to purchase a piece of property, according to court records.
SV Baseline was to represent 50 percent of Vrame’s larger KV Sierra Vista entity and was designed to come up with $5 million to buy a piece of property for development, court records say.
“SV Baseline investors would contribute $2.5 million in cash for their 50% interest in the land purchase,” court records say. “Vrame assured the investors of SV Baseline that the purchase would be in cash, and no debt would be levied against the property.
“SV Baseline investors raised $3.5 million, with $1 million earmarked for additional expenses after the sale.”
But in June 2016 investors discovered there was debt involved with the property purchase and that Vrame “admitted that he had financed the purchase of the property” and had done so “for business reasons” that were justified, court records say.
A year later in July 2017, Vrame showed a balance sheet to investors indicating the entity had $3 million in the bank as of June 21, 2017, court records say.
“Unbeknownst to the SV Baseline investors, Vrame had borrowed the $3 million from an outside company (Company #1) on June 16, 2016,” court records say.
That loan was for 20 days, with a $15,000 fee instead of interest spelled out in a Deposit Authorization Control agreement, or DACA, court records say.
“In effect, the DACA allowed Vrame to show that KV Sierra Vista had $3 million that it did not actually have,” court records say.
Investors discovered the DACA document in the copy room of Vrame’s business office sometime in the summer of 2017, court records say, and subsequently obtained bank records from Vrame’s bookkeeper.
“Those records contained evidence that Vrame had loaned himself money that investors put into those projects,” court records say.
Investigators from the attorney general’s office received Vrame bank records in 2018 following the execution of a search warrant, and filed the 17-page felony complaint Friday.
Portanova, Vrame’s attorney, said Monday that most, if not all, of the money has already been repaid.
“It’s my understanding that most, if not all, of it has been paid off,” Portanova said. “And if any balances remain we’ll see that they are paid off, as well.”
This story was originally published March 8, 2021 at 10:35 AM.