Hawaii resident charged with investment fraud relating to Hurricane Katrina
A Hawaii resident has been charged at the federal court in Honolulu for an investment fraud scheme relating to the Hurricane Katrina on the U.S. mainland, federal officials announced last week.
Kailua resident Dan Doyle, 54, is charged with 27 counts of wire fraud and one count of mail fraud relating to real estate projects designed to rebuild affected areas of Mississippi following Hurricane Katrina, prosecutors announced.
According to the government, Doyle’s investment fraud scheme marketed primarily on AM radio financial shows airing in California.
Honolulu FBI spokesperson Tom Simon said Doyle allegedly offered investments in Mississippi rental properties designed to transition Hurricane Katrina victims out of FEMA trailers and into real homes.
The indictment accuses Doyle of accepting nearly $900,000 in investment money into his Hawaii bank accounts and spending the money on himself, he said.
“For many socially-conscious investors, the ability to make money while helping the less fortunate can be a very enticing offer,” Simon said in an e-mail statement to news organizations, including Samoa News.
“Just because an investment opportunity is broadcast on an AM radio talk show doesn’t necessarily make it a good idea,” he said from Honolulu. “Investors still need to conduct their own research to ensure that what they’re hearing over the airwaves is not a scam. It’s not the radio station’s job to protect you from a bad decision.”
The 10-page indictment describes a program known as the "Gulf Opportunity Zone" ("GO Zone") implemented by the federal government to provide tax incentives to real estate investors and developers seeking to build affordable housing in the Gulf region following the August 2005 devastation of Hurricane Katrina.
The indictment also alleges that Doyle owned and operated a business in Kailua (Oahu island) using names including Investment Real Estate Network and Investment Radio Network.
From late 2007 through December 2009, Doyle allegedly purchased air-time on California talk radio stations to broadcast "radio infomercials" that he hosted and produced touting the benefits of Mississippi "GO Zone" real estate investments.
Listeners to the programs were encouraged to call Doyle’s office in Kailua for investment information.
When potential investors called Doyle's Kailua office, they were allegedly encouraged to wire transfer a refundable deposit to Doyle's business bank account in Hawaii.
According to the indictment, 17 individuals wire transferred or mailed over $890,000 to Doyle in Hawaii as deposits for "GO Zone" investments that were never built. The indictment outlined dates and amounts of the money transferred or mailed by investors, whose names were identified in the indictment by initials.
Instead of preserving the money for potential refunding, Doyle spent investor money on unrelated personal and business obligations including mortgage payments on his Kailua home and yachting expenses, the government alleges.
For each of the wire and mail fraud counts, Doyle faces a maximum period of imprisonment of 20 years, plus possible fines of up to $250,000 and terms of supervised release of up to three years, says the U.S. Justice Department in a news release.
The court issued a penal summons for Doyle to appear in federal court for arraignment, which Simon said is set for Feb. 1.