Fanghella Indicted on Securities Fraud Charges
The founder of a Carlsbad-based mortgage-lending firm was indicted on federal charges in an alleged $330-million securities fraud case.
Michael J. Fanghella, the chairman and chief executive of PinnFund USA, was charged in a 20-count indictment with illegally transferring firm money overseas and deceiving the Department of Housing and Urban Development.
Fanghella, 50, of Rancho Santa Fe, is accused of operating a Ponzi-type scheme that used new investments to pay off old investors. According to the Securities and Exchange Commission, he allegedly used $107 million in investors’ money to finance a lavish lifestyle and buy expensive gifts for his girlfriend, porn star Kelly Cook.
A federal warrant for Fanghella’s arrest was issued in March, after the alleged scheme unraveled. Fanghella left the country, according to his attorney, then surrendered to authorities Aug. 1 in San Diego.
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