Miami real estate developer Bob Zangrillo, embroiled in the college admissions scandal, is facing new charges for allegedly co-owning scam websites that purportedly provide services for government agencies.
The Federal Trade Commission alleges Zangrillo was an officer, chaired and co-owned a company, On Point Global, that operates websites offering to conduct government transactions such as renewing a driver’s license, obtaining a fishing license or checking eligibility for Section 8 housing benefits.
Zangrillo and other defendants collected consumers’ personal data and credit card and debit card information, but never delivered on the services they advertised, according to the FTC’s complaint. Instead, the websites offered consumers who completed a transaction a document of “general, publicly available information about the service the consumer sought for a fee,” the complaint states.
Zangrillo’s lawyer, Matthew L. Schwartz of Boies Schiller Flexner, said in a statement that Zangrillo denies the allegations and was not the chairman or an officer of the company, but rather an investor.
“As a successful businessman for more than 25 years, Mr. Zangrillo’s financial endeavors have established him and his firm as a leading investor in transformational and innovative companies across multiple technology sectors,” Schwartz said. “In his role as an investor and limited partner in numerous organizations, Mr. Zangrillo monitors his investments under his companies’ investor rights but has no role in the day-to-day operations of his portfolio companies.”
Zangrillo, who heads the Miami-based firm Dragon Global, was the founding equity partner in the controversial Magic City Innovation project in Little Haiti.
He was among those charged last year, along with actresses Felicty Huffman and Lori Loughlin, in the largest-ever college admissions scandal in the U.S. Zangrillo allegedly paid off athletic department officials at USC to designate his daughter as an athletic recruit, and had someone take classes on her behalf. He pleaded not guilty in April.
After the scandal broke, Zangrillo, a leading investor and face of the Little Haiti project, stepped away from the development and was replaced by developer Zachary Vella. But Instagram posts over the summer suggested that Zangrillo may still be involved in the project. Twice in August the Silicon Valley investor posted about the project on his personal Instagram account.
According to the latest charges, Zangrillo personally received more than $2 million in distributions and salary from On Point Global and its subsidiaries.
Zangrillo’s lawyers claim, however, that Zangrillo only received partial loan repayments and expense reimbursements from On Point Global, according to court documents.
The FTC’s complaint alleges Zangrillo also acquired space for On Point Global’s second Miami office at 350 Northeast 60th Street and alleges that On Point and Zangrillo’s Dragon Global shared offices. Zangrillo’s lawyers deny they shared office space.
Zangrillo and the other defendants, including Burton Katz who the FTC said was the mastermind of the operation, face violations of the FTC Act.
Miami New Times first reported the FTC’s charges.