An Oakland businessman who played fast and sloppy with $110 million from foreign real estate investors has been sentenced to 16 months in prison.
Thomas Henderson, the former owner of the historic Tribune Tower, was sentenced to prison for his involvement in a fraud scheme, according to the San Francisco Business Times. Restitution will be determined later.
Chief U.S. District Judge Richard Seaborg accepted a guilty plea for the 72-year-old Oakland native who faced up to 10 years in prison for EB-5 visa fraud.
In 2021, Henderson pleaded guilty to one count of conspiracy to commit wire fraud and another to making false statements to the U.S. Citizenship and Immigration Services. Henderson’s partner, Cooper Lee, also pleaded guilty to diverting funds from some investors.
The shorter sentence and three years of probation took into account Henderson’s age, health, and lack of a criminal record.
The real estate investor admitted that he formed a limited liability company in 2010 to raise money from foreign investors through the EB-5 visa program, a job creation and immigration service run by CIS.
The program grants U.S. permanent residence to foreign business investors who invest $1 million or more—or $500,000 in high unemployment areas—in U.S. businesses that create at least 10 full-time jobs.
Henderson used his company San Francisco Regional Center LLC to raise over $100 million from over 200 foreign investors.
In his plea agreement, Henderson admitted to spending investor funds on unrelated business ventures, as well as previous projects that ran out of money, as well as buying new real estate.
The scheme came to light when the U.S. Securities and Exchange Commission sued Henderson for fraud in 2017 after he was sued by business partners for withholding financial information, forfeiting obligations and defaulting on a loan of $3.7 million dollars used to purchase the Jack London Gateway mall. in West Auckland. He was arrested in 2019.
Prior to this, the founder of Avalon Bay Foods and owner of the Tribune Tower, the historic I. Magnin Building, and the Dufwin Theater had been honored by Auckland officials for creating jobs.
Lee pleaded guilty in 2021 to one count of conspiracy to commit wire fraud and was sentenced by Seaborg last April to three years’ probation and $20,000 in restitution. He admitted that he transferred funds from investors and prepared documents to make it look legal.
— Dana Bartholomew