Twin Cities Man’s Scams Bilked Investors of $20M
A federal indictment unsealed Thursday charged a Twin Cities man for orchestrating four investment scams that together bilked at least $20 million from investors, according to the U.S. Attorney's office in Minnesota.
From 2003 through January of this year, Michael Joseph Krzyzaniak-who's also known as Michael Joseph Crosby-allegedly convinced investors to put money into business projects that turned out to be fraudulent.
Krzyzaniak told investors that their money would be used to develop specific projects that had the necessary regulatory approval and were proceeding toward a successful conclusion.
Among the projects that investors thought they were investing in: Internet terminals at airports; golf courses in various states; a golf club resort in Desert Hot Springs, California; alternative energy projects in Hartsel Springs, Colorado; and a Nascar-type race track in Elko.
But instead, Krzyzaniak allegedly spent large portions of the investment funds to pay for personal expenses, fund his lavish lifestyle, and distribute “lulling” payments to investors. In some instances, he invested funds, but only as an effort to prevent his fraud from being discovered-and he spent more than $6.1 million of investors' money on himself.
According to the government, Krzyzaniak told investors that he had various financing sources available to him and a number of celebrity endorsements-neither of which was true. He also allegedly neglected to tell investors that he had been convicted of a federal investment fraud felony in 1993.
Krzyzaniak's business entities include Landmark Properties, Landmark Holding Company, Landmark Midwest, Landmark Energy Group, Landmark Cyber Tech, Landmark Colorado, Coyote Canyon Group, Generation Energy Group, 325 Wise, Crosby and Associates, Palmwood Commercial, and Hartsel Springs Solar.
According to the Star Tribune, golf pro Phil Mickelson is among the individuals who invested with Krzyzaniak; his attorney declined to provide the newspaper with comments or information.
Krzyzaniak faces 14 counts of mail fraud, six counts of wire fraud, three counts of money laundering, three counts of income tax evasion, and four counts of failure to file income taxes. If convicted, Krzyzaniak faces a maximum penalty of 20 years in prison for each count of mail and wire fraud, 10 years for each count of money laundering, five years for each count of tax evasion, and one year for each count of failure to file income taxes.