The Securities and Exchange Commission charge Kenneth Mattson, a San Francisco Bay Area real estate investor, with fraud for what it called a “Ponzi-like scheme.”
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Mattson, the former CEO of LeFever Mattson, is accused of defrauding an estimated 200 investors by selling fake interests in real estate investment limited partnerships. The SEC alleged the total of the fake investments was at least $46 million. Many of the victims of the scheme, the SEC said, were retired senior citizens Mattson met through his church.
“As our complaint alleges, Mattson lied to hundreds of individual investors, many of whom were retirees investing their hard-earned savings, and did not actually sell them the ownership interests that he promised,” Sam Waldon, Acting Director of the SEC’s Division of Enforcement, said. “The SEC is firmly committed to pursuing those who prey on retail investors and retirees, such as the individuals we allege that Mattson targeted.”
According to the SEC, LeFever Mattson managed legitimate limited partnerships that invested in real estate, owned by a set of real investors. Investigators from the SEC said from 2007 to April 2024, Mattson allegedly offered and sold fake ownership interest in the limited partnerships. None of the fake sales were recorded as part of the legitimate records of ownership, and the investors who bought the fake interests never became actual limited partners or received any ownership rights, the SEC said.
Instead, Mattson allegedly commingled new investor funds with personal and business funds and used the investor funds to pay for personal expenses. The SEC went on to allege that Mattson solicited investors to transfer funds from their individual retirement accounts to so-called self-directed IRAs that allowed them to invest in the limited partnership interests Mattson sold. Those sales were also not recorded as part of LeFever Mattson’s books, and the purchase did not make the investors actual limited partners.
The SEC charged Mattson with violating the antifraud and registration provisions of federal securities laws, and seeks permanent injunctions, disgorgement with prejudgment interest, civil penalties and an officer and director bar. The SEC complaint also names KS Mattson Partners LP, Mattson’s other company, as a relief defendant and seeks disgorgement with prejudgment interest from it as well.
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