Jig Is Up in Movie Scam, Feds Say
LOS ANGELES (CN) - Three men were arrested and a woman agreed to surrender after being charged with defrauding people of $22 million in Gigapix, an alleged movie company, federal prosecutors said.
Arrested Thursday were Gregory Pusateri, 49, of Woodland Hills; David Pritchard, 66, of Malibu; and Christopher Blauvelt, 58, of Woodland Hills, the U.S. Attorney's Office said in a statement. Cheri Brown, 65, of Studio City, has agreed to surrender, prosecutors said.
A 36-count indictment was returned under seal on May 15 and was unsealed Thursday. It accuses them of mail fraud, wire fraud, attempted wire fraud and offering sales of unregistered securities.
Blauvelt and Pritchard hired telemarketers to pitch the scheme, which compared Gigapix to nonparty Pixar Animation Studios, according to the indictment. Brown and Pusateri allegedly were their top salespeople.
About 750 investors "lost virtually all of the money - approximately $22.6 million - that they invested," according to the indictment.
In convicted, the defendants could die in prison. Each mail fraud and wire fraud count alone is punishable by up to 20 years in federal prison, prosecutors said.