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Crime News

'If It Sounds Too Good To Be True, It Probably Is': Who Is Investment Scammer John Bravata?

John Bravata would use the promise of a free lunch to lure senior citizens into his seminars and investing in real estate — but their money was actually being used to fund his lavish lifestyle.

By Becca van Sambeck
Us Money G

"A very important rule for investors to remember is if it sounds too good to be true, it probably is," a man cautions in the latest episode of "American Greed: Biggest Cons." The story of John Bravata emphasizes just how crucial that warning is.

John Bravata, with the help of his son Antonio, defrauded hundreds of investors out of millions of dollars in a Ponzi scheme from 2006 to 2009. John primarily targeted senior citizens, using free lunch seminars to entice these people into putting cash in his real estate investment company, BBC Equities, which he founded in 2006 in Brighton, Michigan, according to "American Greed: Biggest Cons" airing on CNBC on Monday, August 17 at 10/9c.

John's showmanship and charisma helped him easily reel in potential victims at these seminars.

"When you first look at John Bravata, John comes off as very polished," FBI agent Eric Newburg told "American Greed," with Jonathan Polish, who works with the U.S. Securities and Exchange Commission, adding, "He's a huge guy, he stands out in a crowd — I mean, he steals all the oxygen out of a room."

John made his pitch very appealing to investors by stressing how safe the investment was, even though it was a total lie.

"I believe your principal dollars is your life. You must cannot risk your your principal dollars, it's crazy [...] It took your whole life to build it," he told potential investors at a seminar, as seen in video footage obtained by "American Greed."

John said their principal investment money would be guaranteed against loss and that they would receive high interest returns, which made investors feel comfortable handing over large chunks of money to BBC Equities.

"The first thing is the fact that they said they were guaranteeing investors would not lose money. The second thing is they sounded like they had a very timely, timely business strategy that could be very profitable," Terry Welsh, a victim of the scam, told "American Greed" while explaining why he invested with John in the first place.

Of course, what was really happening was that John and Antonio were using the money from investors to provide payments to other investors. BBC Equities in reality consisted of some decrepit buildings and a few gas stations, mostly in Ohio. And as for the money that wasn't used to pay interest to investors? They spent it on themselves.

John lived lavishly: He bought a $90k Ferrari for himself and an $85k Maserati car for his wife, lived in a $1.2 million home, and was constructing a massive lakefront mansion. He spent tons of the stolen money on everything from clothes to fine dining to anti-aging treatments. But it would all come crashing down right when the economy did.

Investors, spooked by the 2008 financial crisis, wanted their money back. John insisted everyone's money was safe, desperate to keep them from uncovering the truth: Their money was long gone. In fact, to make sure investors were still getting paid, he knew he needed to reel in new ones — so he simply altered his pitch to align with the current economic mood, even though he was conning them out of their hard-earned retirement cash in a fiscally dark time.

"In the Depression, the richest people who came out of the Depression were those who bought real estate ... it will be the same today,” John told potential victims in video footage obtained by "American Greed."

But John's lies caught up with him anyway. The U.S. Securities and Exchange Commission filed a civil suit against him in 2009, accusing him of running a Ponzi scheme. While the suit was underway, John tried to make a run for it and ended up getting arrested at JFK International Airport in New York City in 2011, while attempting to get on a flight to Italy.

In 2013, John was found guilty of 14 counts of wire fraud and one count of conspiracy. He was sentenced to 20 years in prison. Son Antonio was convicted on one count of conspiracy, and sentenced to five years in prison. In total, they had stolen about 50 million dollars from over 400 investors. And while the convictions surely provided some relief for the victims, it doesn't give them their money back, leaving many of them with difficult times ahead.

Welsh told "American Greed" he and his wife invested most of their money into BBC Equities, and it's now all gone. He believes neither of them will ever get a chance to retire now, and will be forced to continue working instead of enjoying the fruit of decades of labor.

John doesn't seem to feel remorse over his crimes, though.

"As far as me being regretful of something I’ve done in the company, how we ran the company, events that occurred, I have no regrets for that because there was nothing that I did that we would do any differently if we did it over again. There was nothing that was done wrong," he said to "American Greed." "There was no intent at any time by anybody in our company, including myself, to ever defraud any single person that was out there."

For the story of how Antonio allegedly tried replicate the scam's success once free from prison — with coaching from his father, who is still behind bars — watch "American Greed: Biggest Cons" on CNBC on Monday, August 17 at 10/9c.