CHICAGO, Dec. 13 (UPI) -- Michael E. Kelly was sentenced Thursday to five years in prison for securities fraud in a $500 million time-share scheme, the U.S. Justice Department said.
Kelly, who owned hotels in Mexico, pleaded guilty Wednesday and admitted to fraudulently obtaining $500 million from some 8,000 investors across the country, acting U.S. Attorney Gary S. Shapiro said in a release from Chicago.
Kelley, 63, was arrested in December 2006, when prosecutors began to untangle and liquidate his network of properties and businesses in Mexico and Panama. He and his associates used funds raised from investors to purchase hotels, businesses, homes, boats, automobiles, an airplane, a night club and an interest in a real estate development project in Cancun, Mexico, the release said.
On Nov. 20 U.S. District Judge Ronald Guzman ordered the initial distribution of $50 million in restitution to more than 7,000 victims who lost more than $340 million to Kelley's fraud. Guzman said Thursday's actions were only a "small step" in the proceedings against Kelley, as he faces additional charges and possibly more prison time.