FOX 2 – A real estate broker is facing 20 years in prison for allegedly defrauding investors of millions and spending it on the lottery.
Federal investigators say Viktor Gjonaj set up a fake title company and raised $26 million from investors by having them make out checks or wire their money to him or the company.
They thought they were investing in real estate—but Gjonaj was spending the money on the lotto – as much as a million dollars a week.
The feds say Gjonaj’s scheme fell apart in August of 2019 and when the smoke cleared, he had defrauded at least 24 investors of roughly $19 million.
“Honestly I never heard of that before, somebody just giving money to a title company to purchase real estate on their behalf,” said Guy Gailliard, real estate professional. “There are many checks and balances that should come into place, that you should know that this is an actual legitimate sale.”
Real estate professionals were stunned hearing about the scheme. Here’s how it began: the feds say Gjonaj thought he came up with a way to win big jackpots in the Michigan Lottery back in 2016. He started playing often and spending big.
By 2017 investigators say he was losing a lot more than he was making and instead of quitting, he doubled down by using investors’ money to fund his bets and repaying them, for a while, with his winnings – not their returns.
His lawyer Steve Fishman offered this statement: “Victor Gjonaj was a well-respected businessman who, unfortunately, developed a gambling addiction which led him into this situation. His gambling addiction was well known to the state of Michigan, who still allowed him to continue to gamble on the lottery.”
“When we talk responsibility, the responsibility will always fall back on the gambler and you know what? It should,” said Michael Burke.”Somebody who took this kind of money, I don’t believe we can lay it off to anybody else, but the gambler.”
Burke is the executive director of the Michigan Association on Problem Gambling and is an expert in gambling addiction.
“Normally when somebody loses that kind of money, they’ve been doing what we call chasing,” he said. “In other words, they gambled away all of their money and that is gone. And now they’re getting in trouble and they’ve got to get out of it and they go to other sources to get the money. What they want to do is win the money back so they can pay back the people they took the money from.”
He was charged with criminal information. We are told that is normally means the defendant is expected to plead guilty.