Based on a joint investigation conducted by the Louisiana Office of Financial Institutions, the Securities Division of the Mississippi Secretary of State’s Office, the Federal Bureau of Investigation, and the Internal Revenue Service, John F. Kelly, III of Metairie pled guilty to one count of wire fraud on May 25, 2016. Kelly was previously indicted on April 29, 2016 by United States Attorney Kenneth A. Polite in a Bill of Information.
The Factual Basis accompanying Kelly’s guilty plea states that from 2010 through 2014, Kelly operated a tax sale investment business funded by investors. Through his guilty plea, Kelly admitted to defrauding his investors by diverting their investment funds for his personal use and benefit. Kelly further admitted that as part of the scheme to defraud, he used investor money to pay off personal loans and to purchase real estate properties in New Orleans that he titled in separate corporate entities he controlled, without the knowledge of the investors.
The maximum penalty for wire fraud is twenty years imprisonment and a fine of $250,000 or the greater of twice the gross gain to the defendant or twice the gross loss to the victim. United States District Judge Kurt D. Engelhardt set sentencing for August 24, 2016.