Judge Orders $2 Million Be Paid to 2,500 Scam Victims

A Los Angeles County Superior Court judge Monday ordered $2 million in assets from a massive pyramid scheme to be redistributed to more than 2,500 victims, most of whom are working-class Latinos.

Panorama City-based La Luz de Oro Corp., or “Light of Gold” in Spanish, took in as much as $9 million from 16,600 investors, but most of it was never returned, Deputy Dist. Atty. Michael Kraut said.

At a hearing in downtown Los Angeles, Judge Tricia Ann Bigelow ordered redistribution of the $2 million. Restitution of the remaining millions, which investigators have not located, will be determined at a Feb. 23 hearing, Kraut said.

Luz de Oro head Mercedes Navarette, husband Felix Navarette and daughter Joan Frederick were convicted in October 2002 of grand theft, securities fraud and tax evasion in the scheme.

Mercedes Navarette was sentenced to 20 years in prison and her daughter was sentenced to 12 years. Felix Navarette was sentenced to a year in prison and placed on probation.

Mercedes Navarette also was convicted of bigamy, Kraut said.

The company promised investors riches in pep rally-style meetings that blended messages of ethnic empowerment, bootstrapping self-sufficiency and Christian piety. In reality, authorities said, the company bilked working-class people out of their life savings.

One new-car ownership scheme cost Mitsubishi Motor Credit Corp. of America more than $5.4 million in car sales and lease transactions. Mercedes Navarette still owes the State Franchise Tax Board nearly $400,000, Kraut said.

Many of the victims who could be eligible for restitution have not come forward, Kraut said. They can contact Los Angeles police detectives at (213) 485-3795.