An embattled Sonoma real estate mogul has been arrested by federal agents and is accused of operating a Ponzi scheme, the U.S. Department of Justice announced.
Kenneth Mattson, 63, has been indicted on allegations of wire fraud, money laundering and obstruction of justice, prosecutors said.
The DOJ alleges that Mattson got wind of an investigation into his business practices by the U.S. Securities and Exchange Commission last year and he deleted thousands of files relevant to his case.
The nine-count indictment was filed May 13 and was unsealed Thursday.
Mattson ran LeFever Mattson, a corporation based in the Sacramento area that controlled several limited partnerships that owned and managed properties, prosecutors said.
“For more than a decade, Mattson allegedly solicited and obtained millions of dollars in investments from hundreds of investors,” the DOJ said, “many of whom were nearing or in retirement, in what he represented were legitimate and safe interests of limited partnerships that owned real estate.”
But none of the investors’ money was ever actually invested in the partnerships, the government alleges.
“Those representations were false,” prosecutors said flatly.
According to the indictment, from 2009 to 2024, Mattson solicited investments from so-called “off-books” investors, which trade shares away from an exchange or regulated body. One such investment offered by Mattson was in Divi Divi Tree LP, which owned and operated an apartment complex in Riverside County. Prosecutors allege that the majority of his investors in this property used their retirement savings to invest, but never actually became true owners in the partnership.
‘A classic Ponzi scheme’
Some of these investors received distribution payments, but the government alleges that the money came from loans, other assets owned by Mattson, and new investors, in what Acting U.S. Attorney Patrick Robbins describes as “a classic Ponzi scheme.”
“The scheme collapsed when Mattson was no longer able to raise new investor money to pay existing investors,” reads the May 13 indictment.
All told, Mattson is accused of obtaining $28 million in off-book investments from Divi Divi and another company he controlled.
In March, a citizens group called Wake UP Sonoma posted a video to Instagram of a community member confronting Mattson at a local park.
“I find it really interesting that you are still living in Sonoma,” said the woman, who identified herself as a member of Wake UP Sonoma. “Which is a place that you’ve really basically taken advantage of. People are pretty upset with you.”
In the video, Mattson remains silent and continues on his walk.
Last fall, more than 60 entities associated with Mattson and partner Tim LeFever declared bankruptcy.
In August 2024, a class action lawsuit was brought against Mattson and LeFever on behalf of people allegedly bilked by them.
“This case represents one of the largest investment fraud cases of many elderly people and seeks relief for hundreds of investors, many of whom entrusted their life’s savings in the massive investment fraud perpetrated and enabled by Defendants,” reads the complaint.
Mattson was scheduled to make a court appearance this past Friday in San Francisco, prosecutors said.
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