A Sherman Oaks man who amassed a collection of fine art and wine faces sentencing in October for running a $1.3-billion real estate fraud scheme that bilked more than 9,000 victims, many of them senior citizens, according to the U.S. Department of Justice.
Robert Shapiro, 61, pleaded guilty Wednesday in Miami federal court to wire and mail fraud conspiracy and tax evasion. He faces up to 25 years behind bars at sentencing on Oct. 15, the DOJ said.
As part of his plea, Shapiro and his wife agreed to forfeit works of art by Picasso, Chagall and Renoir, more than 600 bottles of vintage wine, a 1969 Mercury convertible, a pair of 14-karat, white gold earrings with two black diamonds, and other luxury items, according to the DOJ.
Shapiro — not to be confused with celebrity attorney Robert L. Shapiro — is the former CEO of the Woodbridge Group of Companies, which employed 130 people and had offices in Sherman Oaks, South Florida and elsewhere.
According to the indictment and court documents, Shapiro headed an enormous Ponzi scheme that operated from July 2012 to December 2017, when Woodbridge filed for Chapter 11 bankruptcy, prosecutors said.
Throughout the scheme, Woodbridge solicited money from investors and, in exchange, issued promissory notes reflecting purported loans to Woodbridge that supposedly paid high monthly interest rates. Using high pressure sales tactics and a telephone “boiler room,” Shapiro and his co-conspirators marketed and promoted his dealings as low-risk investments. Victims were made to believe that Woodbridge’s real estate holdings in Beverly Hills, Aspen and other wealthy areas would generate the funds used to pay the returns, according to federal prosecutors.
According to the indictment, at least 2,600 victims invested their retirement savings, totaling $400 million. Shapiro admitted spending millions on personal expenditures, including $3.1 million on charter flights, $6.7 million on a home, $2.6 million on home improvements and $1.8 million on personal income taxes.
Shapiro further admitted he used bank accounts and credit cards opened in the name of his wife, J.S. — who is not being criminally prosecuted — to divert millions of dollars to his family, prosecutors said.
The indictment also charged two co-defendants, Dane “Dayne” Roseman and Ivan Acevedo, scheduled for trial in February.
The U.S. Securities and Exchange Commission filed parallel civil enforcement actions against Woodbridge, Shapiro, his wife, and co-defendants Acevedo and Roseman related to the Ponzi scheme.