A San Diego man charged with running an investment fraud scheme and taking millions in ill-gotten pandemic loan funds was convicted by a federal jury this week of more than two dozen securities fraud, bank fraud and money laundering counts.
Denny Bhakta, 42, was first charged with soliciting investments for his companies, Fusion Hotel Management LLC and Fusion Hospitality Corp., then using investors’ funds on personal expenses, such as gambling and purchasing vehicles, and to pay off other investors, according to the U.S. Attorney’s Office.
Prosecutors said investors were told Bhakta’s companies would purchase discounted blocks of hotel rooms from Hilton, then sell those rooms for a profit to United Airlines and other companies.
Bhakta provided fabricated bank records and fake agreements with Hilton and United Airlines to make Fusion’s purported business dealings appear legitimate, according to prosecutors, who said Bhakta took around $35 million from investors.
Among the investment fraud victims were Bhakta’s uncle, who lost $4.5 million, as well as Bhakta’s friends and other family members.