A Laguna Niguel man was arrested Thursday for allegedly bilking 10 people he met through church, friends and other personal relationships out of more than $900,000.
William Warren Baker fraudulently promised investors he would buy, refurbish, and re-sell distressed homes for a profit, but what the 57-year-old really did was engange in a Ponzi scheme, according to the Orange County District Attorney's Office.
In Ponzi schemes, investors are offered high, short-term returns
on investments, but instead of the investments generating actual income
and legitimate profits, the money from the investors is kept for the
benefit of the defendant or used to repay earlier investors.
Baker has been charged with 13 felony counts of using untrue statements in the purchase or sale of securities and 13 felony counts of selling securities in issuer transactions without qualifications with sentencing enhancements and allegations for loss over $100,000, aggravated white collar crime over $500,000, property damage over $150,000, and property damage over $200,000.
Baker is also accused of exchanging investor funds for promissory notes or
stocks without qualifying the investments with the California
Department of Corporations, as required by law.
The alleged embezzlement occurred between Jan. 20, 2006, and May 7, 2008, according to prosecutors. Baker allegedly failed to
purchase any property to be renovated and flipped as promised to his
He is accused of instead purchasing a property for
himself and transferring the property into trusts belonging to either his
son or wife.
The complaint alleges Baker used investor money for
personal expenses or to pay back old investors from previous ventures.
If convicted of all charges, Baker could get up to 32 years and eight
months in state prison.
Currently held on $1 million bail–he must prove that the money is from a legal and legitimate source
before posting bond–Baker is scheduled to be arraigned Monday in Santa Ana.