MANHATTAN (CN) - An Italian man pleaded guilty to defrauding investors on Wednesday, after netting over $2 million. He told investors he could use his connections with the Vatican to buy and develop Church properties at a substantial discount, sometimes going so far as to claim he was the Chief Financial Officer of the Vatican.
Between 2005 and June of 2007, Raffaello Follieri falsely marketed the Follieri Group as a real estate investment company that assisted the Catholic Church in selling off its unwanted properties. He told investors he would buy the properties at below market-value, then develop them into revenue-generating projects.
Despite the fact that the Vatican does not need to approve most sales of Church property, Follieri claimed his connections to the Vatican gave him the right of first refusal to buy Church properties.
When buying Church land, however, the Follieri Group submitted bids like any other buyer, and often did not pay below the fair market value.
Under the agreements with his investors, Follieri could only spend the investments on business expenditures. Regardless, he used investments to buy clothes, wines, dog-walking services, a luxury apartment in Manhattan, yacht rentals, and vacations for himself, his girlfriend, and his parents, among other things.
He won investor funds by falsely claiming to pay for a non-existent office in Italy, $800,000 in worthless engineering reports on the Church properties, and thousands of dollars for a consulting company in Europe, among other things.
Despite the Vatican's warning of Follieri to stop claiming that his company had ties with them, he continues making the assertions. His only relation to the Vatican was that he had a Vatican bank account, and wired investor money to an administrative employee of the Vatican.
Follieri is awaiting sentencing, but faces a maximum of 265 years in federal prison, and is liable for $2,400,000 to be subject to forfeiture, along with several Rolex watches and other luxury items.
Reed Brodsky, an Assistant United States Attorney, leads the prosecution.
MANHATTAN (CN) - An Italian man on Wednesday admitted he defrauded investors of more than $2 million by falsely claiming he had connections with the Vatican and could buy church property at bargain prices. Raffaello Follieri, 30, of Foggia, pleaded guilty to conspiracy, wire fraud and money laundering.
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