Source: United States Department of Justice News
LOS ANGELES – A Rhode Island man has pleaded guilty to federal criminal charges, admitting he defrauded investors out of more than $4.2 million in connection with the “Magic Mike Live” stage show in Las Vegas, the Justice Department announced today.
John A. Santilli Jr., 48, of East Greenwich, Rhode Island, pleaded guilty late Thursday to one count of securities fraud and one count of wire fraud.
According to his plea agreement, Santilli managed and partly owned Aloris Entertainment, LLC, which acquired an interest – through securities called “Class A Units” – in Mike’s Mobile Detailing, LLC, the company that operates the “Magic Mike Live” stage show, which is based on two “Magic Mike” movies that chronicle the life of a male stripper.
From June 2016 to February 2020, Santilli raised funds from victims by soliciting investments in “Aloris Magic Mike LP,” a different business that he falsely told investors owned the Class A Units. Santilli lied to investors, telling them that, in return for their investment, they would receive “shares” in Aloris Magic Mike LP that corresponded to a particular number of Class A Units and entitled them to a percentage of the profits from “Magic Mike Live.” To bolster his false claims, Santilli used a doctored legal document that made it appear that Aloris Magic Mike LP was a shareholder of Mike’s Mobile Detailing.
Santilli misappropriated a significant portion of his victims’ investments, including by withdrawing more than $1 million at casinos across the United States, where he used investors’ money for gambling. To raise more funds, Santilli falsely told his victims that new investment opportunities had arisen, resulting in Santilli selling shares in his businesses that corresponded to nearly double the number of Class A Units of Mike’s Mobile Detailing that his company actually owned.
In total, Santilli caused approximately $4,258,679 in losses to his victims.
United States District Judge Fernando M. Olguin scheduled an April 20 sentencing hearing, at which time Santilli will face a statutory maximum sentence of 40 years in federal prison.
The FBI investigated this matter.
Assistant United States Attorney Alexander B. Schwab of the Major Frauds Section is prosecuting this case.