Unknown to his business partners responsible for the marketing to prospective investors, DiMenna prepared substantially inflated cash flow projections for projects. Moreover, DiMenna provided his business partners with false sales contracts and lease commitments. Additionally, he provided other false documentation pertaining to the status of select real estate investments.
“DiMenna provided existing investors inaccurate financial information in order to induce investors not to withdraw an investment, and he provided prospective investors with false information about a project’s financial viability to induce them to invest.”
Further, DiMenna sold equity positions to investors for fully subscribed projects; a prohibited and fraudulent practice. Equally egregious, DiMenna lied to lenders and appraisers through the submission of inaccurate financial data. Other activities included providing lenders with overstated income figures, understated expenses, falsified financial statements, and forgery.
Dimming of The Lights
In the end, DiMenna’s fraudulent scheme duped investors out of nearly $28 million, while lending facilities lost almost $37 million. Aggregate losses totaled close to $64 million.
