Real Life Rodeo Clown: Texas Contractor Defrauds $2.8 Million from Private Investors
Michael Wayne Galvan, a Texas Contractor and former VP of the Houston Livestock Show and Rodeo, pleaded guilty to fraud charges. Photo Credit: Houston Livestock Show and Rodeo, Fall 2016 edition.
Michael Wayne Galvan, 61, from Texas, a high-end contractor under MWG Ventures LLC doing business as “MGB Builders,” pleaded guilty in late September to charges of conspiracy to commit wire fraud, according to a DOJ press release. Galvan admitted to fraudulently obtaining over $2.8 million from seven private investors.
Between February 2016 and March 2018, Galvan was also vice president of the Houston Livestock and Rodeo Organization, the press release detailed. During that time, Galvan used his status to connect with people in other leadership positions at other companies, prosecutors say.
In a 2016 interview featured in Houston Livestock Show and Rodeo promotional material, Galvan said, “We all have the same goal — to support the youth of Texas. It is a great thing we do as a community and the friendships you make out at the Show are life long.”
At least until you ghost your investors.
Fraudulent ‘Business Opportunities’
Galvan promised these business contacts the opportunity to earn between 10% and 12% back in interest if they gave him a short-term loan, according to the indictment. Galvan assured the investors that he would pay the loan back in less than a year, and if he didn’t, the loan interest would be between 10% and 12% per year.
Galvan claimed to need the loans for tile and granite from China for a contracting company he had overseas, but he did not use the money for that purpose, according to the indictment. Galvan received the loans from his investors via check and wire transfer to his bank account and repaid some of the loans with money from other loans.
Seeing what they thought were returns on their investments, some of the repaid investors loaned Galvan more money, according Galvan’s admissions in his signed plea agreement– a hallmark of a classic pyramid scheme. Galvan’s prospects with new investors dried up, however, which delayed payments to existing investors. Galvan assured the investors that returns would resume with new construction projects, but was unable to do so without fresh capitalfrom new investors.
One of Galvan’s investors lost $65,000, according to the plea agreement. Galvan partially repaid another investor $50,000 on Aug. 18, 2018, but never repaid the other $1,086,557.50 he owed that same investor.
Galvan’s case is similar to one in Marana, Ariz., where Daniel Jarret Ridlinghafer, 37, was indicted on Aug. 14 by a grand jury in Tuscon on 11 counts of wire, bank and mail fraud, as previously covered by The Daily Muck.
Ultimately, Galvan’s fraud caused losses of $2.8 million from his investors. He has as agreed to pay all seven investors full restitution as part of the plea agreement.
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