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
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.