A Granite Bay man has been sentenced to more than two years in prison for his role in an investment fraud scheme.
John Stuart Hill, a 33-year-old property investor, pleaded guilty in September to mail fraud and wire fraud in connection with a real estate investment scheme. U.S. District Judge Morrison C. England Jr. on Thursday sentenced Hill to two years and three months in prison and ordered him to pay $1.4 million in restitution to eight victims, according to a U.S. attorney’s office news release.
Between Aug. 9, 2011, and April 2013, Hill, acting under the business name Granite Bay Investment Partners, solicited and received money from investors who intended that the funds would be used to purchase, rehabilitate and resell residential property in the Sacramento area, according to court documents. Instead, Hill used the money for his personal expenses, made false accounting entries on statements that he sent to his investors, and misrepresented the purchase and resale prices of the properties involved.
In some cases, Hill had never purchased the properties that he claimed his investors were rehabilitating. In other cases, multiple investors were told that they were partners on the same property to increase the amount invested to far more than the purchase and rehabilitation costs, authorities said.
Hill received at least $1.9 million from investors, only $600,000 of which was ever returned and leaving at least $1.3 million unaccounted for, according to court documents.
The case resulted from an investigation by the U.S. Secret Service.