Federal officials allege that Sonoma County real estate tycoon Kenneth Mattson bilked nearly 200 investors out of at least $46 million in a series of fraudulent real estate deals, and arrested him Thursday morning in a wine country gymnasium parking lot.
The image above is that of a Sonoma County grocery and delicatessen called Sonoma’s Best. Its back offices had in recent years served as the headquarters for its owner, real estate tycoon Kenneth Mattson. The Chronicle reported about a year ago that Mattson’s real estate empire of “more than 257 properties worth at least $413 million in 14 counties” seemed to be crumbling, racking up lawsuits and unpaid bills. Though the Santa Rosa Press Democrat had already been on this case for more than a year, also reporting that Mattson’s home was raided by the FBI in May 2024, and that Mattson was often confronted by jilted investors while out jogging.
It was perhaps even more amusing last June, when Mattson was selling off his properties at fire-sale prices, that the Sonoma Index-Tribune reported that Mattson and his wife had the sheriff’s office called on them for “unlawfully removing items” from the Sonoma’s Best deli after he had just sold the place.
Now Mattson’s financial troubles are definitely much worse. The Chronicle reports that Mattson was arrested Thursday morning by federal agents, whose indictment of Mattson said he was running a “a classic Ponzi scheme.” The Napa Valley Register adds that he was arrested in the parking lot of Napa County’s OrangeTheory gym.
The US Securities and Exchange Commission (SEC), which today filed a separate civil case against Mattson, explains the scheme involving LLC “limited partnerships.”
“From approximately 2007 to April 2024, Mattson allegedly offered and sold fake ownership interests in these limited partnerships to defrauded investors,” the SEC alleges. “According to the complaint, the fake sales were not reflected in the legitimate records of ownership, and investors who purchased the fake interests never became actual limited partners or received ownership rights. Instead, Mattson allegedly commingled new investor funds with personal and business funds and used the commingled funds to make Ponzi-like payments, gave defrauded investors false tax records, and misappropriated investor funds to pay for personal expenses and real estate transactions.”
Per the Chronicle, the SEC also warned Mattson in April 2024 to preserve all financial records related to his real estate deals. The indictment alleges he promptly deleted some 10,000 records.
The SEC’s complaint says that many of Mattson’s alleged victims “were retired senior citizens Mattson met through his church community.” Mattson and his wife Stacy’s Bible-thumping are an interesting sidebar to this whole scandal.
The Sonoma Index-Tribune has a pretty exhaustive rundown of the Mattsons' well-established anti-LGBTQ bent, earning them a number of local boycotters. Stacy Mattson, whose social media complaints about American culture being “high-jacked by the gay agenda,” was not mentioned in today’s indictments. That said, she had a tax lien for about $900,000 this time last year.
Related: Los Gatos-Based HGTV House-Flipper Sentenced to Four Years In Jail for Real Estate Fraud [SFist]
Image: John Y via Yelp
