Utah, California Men Arrested for $25M Ponzi Scheme Linked to Fake Mexican Casino
Federal officials in Utah have charged two individuals for running an alleged $25 million Ponzi scheme by persuading victims to invest in a nonexistent casino venture in Mexico.
According to prosecutors, Thomas Paul Madden, 66, from Washington City, Utah, and Jeremy Tyler Grabow, 54, from Ladera Ranch, California, deceitfully asserted their participation in a major casino resort venture in Mexico via a sham computer systems firm named Savitar, which they both managed.
‘Mirage’ Gaming Establishment
Starting in 2021, the defendants informed at least 10 victims that they were collaborating with casino powerhouse MGM Resorts, Mexican tour company Cabo Paradise, data center firm Datapod, and the Mexican Lottery on the initiative. They asserted that the casino would be constructed in the resort town of Cabo San Lucas and that Savitar had already secured millions of dollars in funding.
However, the casino was an illusion. Savitar did not possess the indicated business partnerships and had no business activities apart from being a fraudulent investment entity.
Prosecutors stated that the Savitar scheme generated over $2 million for the duo, which went toward settling prior investors and covering personal costs.
At the same time, Madden was running an additional Ponzi scheme via another fake investment firm, Cascade.
From 2017 onward, the defendant guaranteed investors substantial profits from penny stock transactions. However, rather than investing the funds, prosecutors allege he utilized the money for Ponzi payments and his personal expenses. By doing so, Madden managed to collect $23 million from approximately 200 supposed victims.
Insufficient Funds Checks
Madden was apprehended in 2023 for writing fraudulent checks to his investors but persisted in pursuing new investments despite his felony conviction in the Utah Fifth District Court in 2024.
On March 7, 2024, during a plea to the Fifth District Court judge for a probationary sentence to “meet restitution obligations to investors,” Madden falsely claimed that the “project down in Cabo … could receive funding as early as next week, which will generate significant funds,” as stated in court documents.
Last week, an indictment was issued by a federal grand jury, resulting in arrests. Madden faces four counts of wire fraud, and he along with Grabow is accused of conspiracy to commit wire fraud and conspiracy to commit money laundering.
