MAN SENTENCED FOR PART IN $58 MILLION HOMEOWNERS' ASSOCIATIONS TAKEOVER AND CONTRACTOR SCHEME

FROM:  U.S. JUSTICE DEPARTMENT 

Thursday, August 6, 2015

FORMER CONSTRUCTION BOSS SENTENCED TO MORE THAN 15 YEARS FOR ROLE IN $58 MILLION SCHEME TO FRAUDULENTLY CONTROL HOMEOWNERS’ ASSOCIATIONS

A former construction boss from Las Vegas was sentenced today to 188 months in prison for his role in a $58,141,275 million scheme to fraudulently gain control of condominium homeowners’ associations (HOAs) in the Las Vegas area to secure construction and other contracts for himself and others.  Forty-two individuals have been convicted of crimes in connection with the scheme.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Special Agent in Charge Laura A. Bucheit of the FBI’s Las Vegas Office, Sheriff Joseph Lombardo of the Las Vegas Metropolitan Police Department and Chief Richard Weber of the Internal Revenue Service-Criminal Investigation (IRS-CI) made the announcement.

Leon Benzer, 48, pleaded guilty on Jan. 23, 2015, to one count of conspiracy to commit mail and wire fraud, 14 counts of wire fraud, two counts of mail fraud and two counts of tax evasion.  In addition to imposing the prison term, U.S. District Judge James C. Mahan of the District of Nevada ordered Benzer to pay restitution in the amount of $13,294,100.

“Leon Benzer recruited and paid off puppets to serve on homeowners’ boards so that they would steer lucrative contracts to his company and cronies,” said Assistant Attorney General Caldwell.  “Far from enjoying their corrupt proceeds, however, Benzer and his co-conspirators will serve years behind prison bars.”

“This sentence serves as a reminder of the FBI's dedication and commitment to investigate, apprehend and prosecute criminals that prey on innocent and unsuspecting consumers,” said Special Agent in Charge Bucheit.

“When Leon Benzer named his company, Silver Lining Construction, he probably wasn’t aware of the IRS Criminal Investigation Division and the expertise of our special agents when it comes to putting pieces of a puzzle together to build a picture of fraudulent activity,” said Chief Weber.  “Benzer manipulated and bribed HOA boards in order to enrich himself and his co-conspirators at the expense of American taxpayers.  Not only did he try to hide the proceeds of his crimes in order to evade paying taxes, but he failed to pay his employment taxes.  Today, justice was served and the “silver lining” that Benzer anticipated was not realized thanks to the work of IRS-CI and our law enforcement partners.”

In connection with his guilty plea, Benzer admitted that, from approximately August 2003 through February 2009, he and an attorney developed a scheme to control the boards of directors of HOAs in the Las Vegas area.  According to plea documents, Benzer and his co-conspirators recruited straw buyers to purchase condominiums and secure positions on HOAs’ boards of directors.  Benzer admitted that he paid the board members to take actions favorable to his interests, including hiring his co-conspirator’s law firm to handle construction-related litigation and awarding remedial construction contracts to Benzer’s company, Silver Lining Construction.

The case was investigated by the FBI, IRS-CI and the Las Vegas Metropolitan Police Department’s Criminal Intelligence Section.  The case was prosecuted by Deputy Chief Charles La Bella and Trial Attorneys Thomas B.W. Hall and Alison Anderson of the Criminal Division’s Fraud Section.