Source: Federal Bureau of Investigation (FBI) State Crime Alerts (c)

NEWARK, N.J. –  An Indianapolis man was sentenced today to 41 months in prison today for his role in a scheme to defraud real estate investors, Acting U.S. Attorney Vikas Khanna announced.

Herbert Whalen, a/k/a “Bert Whalen,” 50, of Indianapolis, Indiana, previously pleaded guilty in Newark federal court to conspiracy to commit wire fraud for his role in a multi-million dollar real estate investment scheme that took place in Indiana and New Jersey.  Judge Madeline Cox Arleo imposed the sentence today in Newark federal court.

According to documents filed in this case and statements made in court:

From August 2016 to July 2018, Whalen, who operated Oceanpointe Property Management in Indianapolis, engaged in a scheme to obtain money from real estate investors by misrepresenting and concealing the poor condition of properties managed by Oceanpointe and by creating fake leases for unoccupied Oceanpointe properties. Investors were promised that, after repairs and rehabilitations were completed, and tenants rented the properties, investors would receive copies of the leases and begin to receive rent payments as their return on investment. In reality, many Oceanpointe properties were not repaired and rehabilitated, and were not ready for occupancy. To conceal these facts from victim investors, Whalen and a conspirator directed Oceanpointe employees to draft fake leases, making it appear to investors that Oceanpointe properties were rented, when, in fact, the properties remained vacant. Whalen instructed Oceanpointe employees to place fake tenant names on leases to send to Oceanpointe investors.

Whalen and others commingled tenant rent payments and selected which investors would be paid from the pool of funds in order to silence investors who voiced concerns and evade detection of the fraud. In order to prevent investors from leaving Oceanpointe and exposing his fraudulent conduct, Whalen directed an Oceanpointe employee to create a false identity and falsely claim, on an online real estate message forum, that the Oceanpointe employee was an investor with Oceanpointe and another company, and that Oceanpointe had addressed all of the concerns regarding the investment property. These misrepresentations and others led to millions of dollars in losses to investors, which Whalen used to, among other things, fund his lifestyle.

In addition to the prison term, Judge Arleo sentenced Whalen to three years of supervised release.

Acting U.S. Attorney Khanna credited special agents of the FBI, under the direction of Acting Special Agent in Charge Terence G. Reilly in Newark, with the investigation leading to the charge.

The government is represented by Assistant U.S. Attorneys Caroline Silane of the Economic Crimes Unit and Ari B. Fontecchio, Chief of the Opioid Abuse Prevention and Enforcement Unit.

                                                           ###

Defense counsel: John L. Tompkins, Tompkins Law, Indianapolis, IN

Source: Federal Bureau of Investigation (FBI) State Crime Alerts (c)

NEWARK, N.J. –  An Indianapolis man was sentenced today to 41 months in prison today for his role in a scheme to defraud real estate investors, Acting U.S. Attorney Vikas Khanna announced.

Herbert Whalen, a/k/a “Bert Whalen,” 50, of Indianapolis, Indiana, previously pleaded guilty in Newark federal court to conspiracy to commit wire fraud for his role in a multi-million dollar real estate investment scheme that took place in Indiana and New Jersey.  Judge Madeline Cox Arleo imposed the sentence today in Newark federal court.

According to documents filed in this case and statements made in court:

From August 2016 to July 2018, Whalen, who operated Oceanpointe Property Management in Indianapolis, engaged in a scheme to obtain money from real estate investors by misrepresenting and concealing the poor condition of properties managed by Oceanpointe and by creating fake leases for unoccupied Oceanpointe properties. Investors were promised that, after repairs and rehabilitations were completed, and tenants rented the properties, investors would receive copies of the leases and begin to receive rent payments as their return on investment. In reality, many Oceanpointe properties were not repaired and rehabilitated, and were not ready for occupancy. To conceal these facts from victim investors, Whalen and a conspirator directed Oceanpointe employees to draft fake leases, making it appear to investors that Oceanpointe properties were rented, when, in fact, the properties remained vacant. Whalen instructed Oceanpointe employees to place fake tenant names on leases to send to Oceanpointe investors.

Whalen and others commingled tenant rent payments and selected which investors would be paid from the pool of funds in order to silence investors who voiced concerns and evade detection of the fraud. In order to prevent investors from leaving Oceanpointe and exposing his fraudulent conduct, Whalen directed an Oceanpointe employee to create a false identity and falsely claim, on an online real estate message forum, that the Oceanpointe employee was an investor with Oceanpointe and another company, and that Oceanpointe had addressed all of the concerns regarding the investment property. These misrepresentations and others led to millions of dollars in losses to investors, which Whalen used to, among other things, fund his lifestyle.

In addition to the prison term, Judge Arleo sentenced Whalen to three years of supervised release.

Acting U.S. Attorney Khanna credited special agents of the FBI, under the direction of Acting Special Agent in Charge Terence G. Reilly in Newark, with the investigation leading to the charge.

The government is represented by Assistant U.S. Attorneys Caroline Silane of the Economic Crimes Unit and Ari B. Fontecchio, Chief of the Opioid Abuse Prevention and Enforcement Unit.

                                                           ###

Defense counsel: John L. Tompkins, Tompkins Law, Indianapolis, IN