Sacto 9-1-1
April 13, 2012
Roseville contractor headed to prison for defrauding investors

Roseville building contractor Leo Wheeler was sentenced today in Sacramento to four years and three months in prison for defrauding investors in a real estate project.

Wheeler, 56, was sentenced by U.S. District Judge Garland E. Burrell Jr. and will be subject to three years of supervised release following his prison term.

According to court documents, Wheeler defrauded more than 10 investors of hundreds of thousands of dollars by submitting approximately 85 fraudulent invoices for work he falsely claimed he had performed on a 30-lot subdivision known as Creekside Oaks Estates in Lake County. Wheeler used three fictitious companies -- Kenneth Gutman Trucking, SNC Solutions and California Maintenance -- to funnel funds to himself and to other projects. During an interview with an IRS special agent, Wheeler admitted he had falsified numerous invoices and wrongly diverted investor funds, authorities said.

In sentencing Wheeler, Judge Burrell said that he was troubled by Wheeler's submission to the court of an 11-page letter that minimized his conduct and claimed he had never engaged in a scheme to defraud, according to a federal Department of Justice news release.

The judge granted the government's motion to take Wheeler into custody rather than allowing him to surrender himself at a later date.

The case resulted from an investigation by the Internal Revenue Service-Criminal Investigation.

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