New York-based investment manager Brent Borland, of Borland Capital Group, has pleaded guilty to the operation of a $21.9 million fraud, according to a report by Reuters. Borland pleaded guilty to one count of securities fraud, one count of wire fraud, and one count of conspiracy, according to the Department of Justice, each of which has a maximum possible sentence of 20 years in prison.
Borland was arrested and charged in May 2018 in connection with his role as owner and principal the Belize Infrastructure Fund I LLC, according to the Department of Justice, which alleged he “induced investors to contribute over $21 million into the construction of an airport in Belize by promising a high rate of return, which was secured by real property owned by the fund.” In fact, according to the charges, some of that property did not exist, and Mr. Borland used investors’ funds for his own personal expenses, included private school tuition for his children, membership to a beach club, and luxury vehicles. According to the charges, he solicited and received about $21.9 million from about 40 investors, representing that the funds would be used for the construction of a Belize airport. Despite his representations that the investments would yield high rates of return, according to the charges, “all known investors in the scheme lost money.”
In a statement made when charges were announced, the US Postal Inspection Service Inspector-in-Charge said, “Brent Borland allegedly lied to investors and inappropriately used their investment funds to finance a life of luxury. Postal Inspectors remind investors, where there is high reward, there is high risk. If an investment offer sounds too good to be true, it’s most likely a scam.” United States Attorney for the Southern District of New York Geoffrey Berman said, “Cases such as this serve as a cautionary tale for investors – always carefully vet your investments – and if something seems too good to be true, it probably is.”