Posted on: January 29, 2021, 11:46h.
Last updated on: January 29, 2021, 12:49h.
A Michigan real-estate executive with a $1 million per week lottery habit is accused of bilking investors out of $19 million to buy tickets.
Viktor Gjonaj, 43, of Shelby Township, is the founder of the initially successful Troy-based real-estate firm Imperium Group, which collapsed in the summer of 2019 after he stopped showing up for work.
He is also the founder of Title Plus Services, a sham company established solely for the purpose of feeding his colossal lottery obsession.
Widescale System of Fraud
According to federal prosecutors, six years ago the father of four became convinced that he had discovered a way to win huge jackpots on the Michigan Lottery by buying tickets in large enough volume.
Gjonaj became so consumed with the idea that he embarked on a path of widescale fraud, believing that he would one day make good with his victims when his numbers finally came up.
They never did. Instead, he was charged Thursday with wire fraud. He is expected to plead guilty and faces up to 20 years in prison.
“The defendant’s lies have caught up with him and he will now face the consequences of his fraudulent scheme,” Timothy Waters, special agent in charge of the FBI in Michigan, said in a statement.
The Sham Company
In 2017, Gjonaj found he was spending more money than he was winning while pursuing his lottery system, but he refused to face the facts, prosecutors said. Using his experience as a real estate broker, he formed Title Plus and convinced victims to give him money, which he said he would invest in real-estate deals that promised eye-catching returns.
But according to prosecutors, Title Plus was a shell company and a Ponzi scheme. There was no investment in property, just in the Michigan Lottery, as Gjonaj diverted the money to fund his deranged gambling scheme.
“In order to trick and induce investors into continuing to give him money, Gjonaj described entirely fictitious real estate deals and often paid investors ‘profits’ which he falsely claimed resulted from the sale of real estate,” prosecutors said.
Digging a Hole
By August 2019, Gjonaj’s actions became more and more desperate as his scheme began to unravel and investors came knocking. As the civil lawsuits mounted, he was spending $1 million a week on lottery tickets.
According to Crain’s Business Detroit, at this point, Gjonaj either fled or attempted to flee the country.
“This case shows us that criminals may use sophisticated methods and apparently legitimate businesses, but their crimes amount to nothing more than stealing other people’s money,” US Attorney Matthew Schneider said in a statement.
The defendant’s gambling harmed not just himself, but many other innocent victims as well,” Schneider added.
Gjonaj’s lawyer, Steve Fishman, told The Detroit News that his client was a gambling addict whose spending could not have gone unnoticed by the Michigan Lottery, which should have intervened.
“Viktor Gjonaj was a well-respected businessman who, unfortunately, developed a gambling addiction that led to this situation,” Fishman said. “His addiction was well-known to the state of Michigan which, nevertheless, allowed him to keep gambling.”