WASHINGTON -- The mastermind behind a $40 million scheme to sell bogus municipal bonds to investors nationwide pleaded guilty Friday to securities fraud, racketeering, and money laundering, federal prosecutors announced on Friday.
John Anthony Genetti, 45, of Santa Barbara, Calif., faces 60 years in prison and a fine of $96.6 million, Terree Bowers, U.S. attorney for the Central District of California, said last week.
Genetti was responsible for conceiving and directing a complex scheme spanning seven years that involved several companies, including FSG Financial Services Inc., marketing nonexistent municipal bonds, Bowers said.
Genetti was the fourth and final defendant to be convicted as the result of a joint investigation by the Federal Bureau of Investigation, the Internal Revenue Service, and the U.S. attorney's office. The others, Westley Scher, Joan Kantor, and Louis Vargas, have all been convicted of various charges in connection with the case.
Scher is currently serving a six-year sentence in federal prison and Kantor and Vargas are to be sentenced shortly.
As part of a plea agreement, Genetti agreed to forfeit a number of assets, including his $2.1 million dollar estate and a 1989 Mercedes-Benz convertible.