Indian-origin Miami developer Rishi Kapoor sentenced to over 11 years in $89 million fraud case

A Miami real estate developer of Indian origin has been jailed for 11 years and four months in prison after pleading guilty to money-laundering and payroll-tax conspiracy charges linked to an $89 million fraud scheme involving investors in his South Florida property projects, according to Miami Herald.Rishi Kapoor, 42, was sentenced on Thursday by US District Judge K. Michael Moore in federal court in Miami. Kapoor, the former CEO of Location Ventures and URBIN, told the court that he had acknowledged his “sins and crimes” and apologized to investors, former employees and his family for the harm he had caused.“I fully accept responsibility for my crimes without hesitation or excuse,” Kapoor wrote in a letter to the judge before sentencing.Kapoor was arrested in March on a 37-count federal indictment. Prosecutors said he raised at least $89 million from more than 50 investors for South Florida residential projects and owed at least $70 million in restitution to those investors. At least another $800,000 was owed to the Internal Revenue Service.The case centred on Location Ventures projects in parts of South Florida including Coconut Grove, Miami Beach, Coral Gables and Fort Lauderdale. Prosecutors alleged that money raised for individual developments was diverted for other purposes, including Kapoor's personal expenses.Kapoor pleaded guilty in May to conspiring to defraud the United States by failing to remit payroll taxes withheld from employees' wages for Social Security and Medicare between 2020 and 2022. According to the indictment, he also failed to file personal federal income-tax returns from 2019 through 2023.He also pleaded guilty to a money-laundering charge involving $820,559 transferred from his personal bank account as a down payment towards the purchase of a $5 million, 68-foot Princess yacht in 2022.The two charges to which Kapoor pleaded guilty carried a maximum combined sentence of 15 years.Prosecutors recommended that Kapoor serve 136 months in prison. His lawyers had sought a 121-month sentence, or just over 10 years, which they said was at the lower end of the applicable sentencing guidelines.Kapoor's defence also disputed prosecutors' description of the case as an $89 million fraud scheme. His lawyer Don Samuel told the court that Kapoor himself had earned about $6 million over the relevant eight-year period, including his salary from Location Ventures.“This is not a Ponzi scheme,” Samuel said. “He was not swindling anybody.”Prosecutor Elizabeth Young argued that Kapoor had raised the $89 million through “fraudulent misrepresentations” and used funds intended for one real estate project to finance another.The original federal indictment accused Kapoor of using investor money intended for real estate developments for personal expenses and other purposes. Prosecutors previously alleged that several promised condominium projects were never completed, including developments in Coconut Grove and Miami Beach.Court documents also accused Kapoor of withholding payroll taxes from employees and failing to send the money to the IRS. Prosecutors alleged that around $2 million in payroll taxes was retained rather than remitted.Kapoor was also accused of making misleading statements to banks while seeking money for the yacht and other expenses. Prosecutors said he told investors he had contributed about $13 million of his own money to the ventures, while the actual amount was roughly half that figure.The indictment further alleged that Kapoor deceived escrow agents to obtain the release of pre-construction condominium deposits and then diverted the money to personal expenses unrelated to the developments.Kapoor had built a profile in South Florida's real estate and political circles through his companies and had ties to the mayors of Miami and Coral Gables. His criminal case followed a separate Securities and Exchange Commission civil enforcement action in 2024 involving another alleged fraud scheme. Kapoor agreed to pay restitution in that matter without admitting wrongdoing.Catch the latest World News and Live updates. Download the TOI app.