A Miami businessman who stole millions of dollars from hundreds of investors faces a maximum of 20 years in prison after pleading guilty to a wire fraud conspiracy.
Efrain Betancourt Jr., 36, a dual citizen of the United States and Colombia, admitted in a plea agreement filed last week that he defrauded more than 600 Venezuelan-American investors in the Miami area out of approximately $66 million through his payday loan company, Sky Group USA.
Between 2016 and 2020, Betancourt solicited money from investors, promising high returns from short-term, high-interest loans to consumers, but, in reality, only about $12.2 million was used for those loans.
The remainder of the funds was spent on company operating costs, sales commissions and Betancourt’s personal expenses, according to a factual statement submitted with the plea agreement, the Miami Herald reported.
According to prosecutors, Betancourt misappropriated more than $6.5 million for his own use which included money spent on a luxurious wedding at a French château.
The former CEO put the large sum of money toward the wedding on the French Riviera, Caribbean vacations, expensive jewelry, a private aircraft and a luxury high-rise condominium on Biscayne Boulevard in downtown Miami, according to the Miami Herald.
As part of his sentencing, Betancourt is expected to pay $8.3 million in forfeiture – a figure that includes credit card expenditures, according to federal prosecutor Roger Cruz.
Betancourt has pleaded guilty to fleecing millions from Venezuelan investors to fund his lavish lifestyle, including luxury condo in Miami and wedding at French chateau. Pictured: Efrain Betancourt Jr., CEO of Sky Group USA, with his current wife, Leidy Badillo
Between 2016 and 2020, Betancourt solicited money from investors, promising high returns from short-term, high-interest loans to consumers, but, in reality, only about $12.2 million was used for those loans. Pictured: Part of Sky Group USA’s ‘Team of experts’ as seen on the company’s Facebook page
Cruz also indicated that six additional wire fraud charges against Betancourt will be dismissed at sentencing as part of the plea agreement.
Betancourt has been in federal custody since his arrest last November at Miami International Airport after prosecutors argued that he posed a flight risk, with potential travel ties to Latin America and the United Arab Emirates.
The former CEO’s guilty plea comes roughly three years after Betancourt and his company settled a civil case with the US Securities and Exchange Commission (SEC).
SEC attorneys accused him of using his payday loan company to defraud investors, and a federal judge ordered Betancourt and Sky Group to repay more than $39 million.
However, according to authorities, investors have received no compensation since that judgment.
Both the SEC and federal prosecutors described Sky Group’s operation as a ‘Ponzi scheme.’
Betancourt sold promissory notes to investors with the promise of double- and triple-digit annual returns and while some early investors were partially repaid, most were not.
The embattled businessman’s fraudulent scheme collapsed in 2020, when the COVID-19 pandemic triggered mass defaults on the consumer loans Sky Group issued, causing a severe cash-flow shortage and halting investor payouts.
‘He never paid a dime to resolve the claims,’ Miami attorney Richard Diaz, who represents three victims of the scheme, said.
According to prosecutors, Betancourt misappropriated more than $6.5 million for his own use which included money spent on a luxurious wedding at a French château. Pictured: Chateau de Chantilly, in Chantilly, France
Betancourt sold promissory notes to investors with the promise of double- and triple-digit annual returns and while some early investors were partially repaid, most were not. ‘He never paid a dime to resolve the claims,’ Miami attorney Richard Diaz (pictured), who represents three victims of the scheme, said
‘My clients and I are looking forward to personally attending his sentencing to express to the judge the gravity of his greed and fraud, which economically devastated, not just hurt, many families.’
According to court documents, Betancourt funneled millions in fraudulent proceeds to family members and associates.
Cruz wrote that ‘millions of dollars in fraudulent proceeds directly obtained by this defendant have disappeared, were funneled by him to his wife and other family members, and have otherwise been transferred overseas.’
The SEC also reported that Betancourt transferred at least $3.6 million to individuals including his ex-wife, Angelica Betancourt and to EEB Capital Group LLC – a company whose bank accounts were controlled by Betancourt and his current wife, Leidy Badillo.
The transfers were described as having ‘no apparent legitimate business purpose,’
In 2022, EEB Capital agreed to pay $2.2 million toward the judgment against Sky Group and Betancourt. Angelica Betancourt, who reported a $60,000 salary from Sky Group, also agreed to pay approximately $1.1 million toward the settlement.
Angelica Betancourt, who reported a $60,000 salary from Sky Group, also agreed to pay approximately $1.1 million toward the settlement.
Betancourt’s sentencing hearing is set for August 14 before US District Judge Darrin P. Gayles where he faces a maximum sentence of up to 20 years in prison.
