A federal grand jury last week indicted Palm Beach developer Robert V. Matthews and his wife on one count of tax evasion.
Matthews and his wife, Maria Matthews, would face a maximum prison sentence of five years if found guilty of tax evasion.
The charge of tax evasion was added to a 20-count indictment alleging that Matthews stole tens of millions of dollars from foreign investors who thought they were financing a resort development in Palm Beach called the Palm House Hotel.
Matthews and his former attorney, Leslie R. Evans, have pleaded not guilty to fraud and conspiracy charges in the indictment, which stem from their recruitment of foreign investors in the Palm House project through the federal EB-5 visa program.
Dozens of investors put $500,000 each into the Palm House project through the EB-5 program, which provides visas for residency in the United States to qualified foreign investors.
Matthews’ legal problems worsened last month when the Securities and Exchange Commission accused him and an EB-5 regional center and its director, Joseph Walsh, of defrauding the foreign investors in the Palm House project. Construction work on the project at 160 Royal Palm Way stopped in 2014.
The SEC filed a lawsuit alleging that Matthews and the other defendants misappropriated a large portion of $43.9 million from foreign investors.
The agency’s lawsuit charges that Matthews spent some of the misappropriated funds on his Connecticut home and his 151-foot yacht, and to preserve his ownership of a mansion in Palm Beach, which was threatened by foreclosure.
The SEC suit also alleges that the defendants made false claims that various celebrities would serve on a Palm House advisory board, including Donald Trump, Bill Clinton and Celine Dion.
The SEC didn’t name Matthews’ former attorney, Evans, as a defendant in its lawsuit. [Hartford Courant] – Mike Seemuth