Betrayal in Wine Country: Sonoma Developer Accused of Masterminding $28 Million Ponzi Scheme

SONOMA COUNTY, CA – Kenneth W. Mattson wasn’t just selling real estate he was selling a dream. A dream of prosperity, security, and legacy. For hundreds of investors, many cashing out retirement funds or betting their life savings, that dream has curdled into a nightmare.

This week, federal authorities unmasked the man once known as a rising star in California’s real estate market as the alleged architect of a brazen $28 million Ponzi scheme, one that may rival some of the most notorious in the state’s history.

Mattson, 63, was arrested and indicted on multiple federal charges, including wire fraud, money laundering, and obstruction of justice. According to the Department of Justice, his empire built under the banner of LeFever Mattson and KS Mattson Partners LP was a house of cards propped up by lies, misdirection, and manipulation.

The Illusion of Wealth

From upscale developments in Citrus Heights to glossy brochures promising lucrative returns, Mattson cultivated the persona of a savvy developer with an eye for untapped opportunity. But behind the closed doors of investor meetings, the feds say, he was running a financial mirage.

Instead of profits from property sales or rental income, Mattson allegedly paid early investors with money from newer ones, a textbook Ponzi scheme that unraveled only after millions had vanished.

“He sold hope and delivered heartbreak,” said Acting U.S. Attorney Patrick D. Robbins. “And for many victims, the cost wasn’t just financial, it was their future.”

Retirees Robbed of Their Golden Years

Mattson’s scheme appears to have targeted those least able to afford loss: retirees. For many, these weren’t high-risk bets; they were careful investments in what they believed were tangible assets. Some dipped into pension funds. Others liquidated IRAs. One investor reportedly took out a second mortgage to buy in.

They were told their money would go into real estate development projects with high returns and low risk. But according to the indictment, the properties either underperformed or were never viable to begin with.

“He looked like someone you could trust,” said a 71-year-old widow from Napa who invested nearly $200,000. “Now I’m back to clipping coupons.”

A House Built on Lies

Investigators say Mattson used sophisticated tactics to conceal the scheme’s collapse. He allegedly withheld key information about asset sales, recruited new investors without disclosing mounting losses, and shuffled money between partnerships to create an illusion of profitability.

But the most chilling moment came in April 2024, when the SEC subpoenaed Mattson. Rather than comply, he allegedly deleted thousands of internal documents an act prosecutors are calling obstruction of justice.

“This wasn’t sloppy bookkeeping,” said FBI Special Agent in Charge Sanjay Virmani. “This was a deception by design.”

The Facade Cracks

Mattson’s glossy veneer began to crack during his first court appearance in San Francisco this week. Flanked by federal marshals, the man once celebrated for his development acumen now faces the full weight of a federal prosecution.

The indictment outlines misconduct across multiple entities, including Divi Divi and Heacock Park projects that now serve as cautionary tales in the perils of unchecked trust. The charges span five years and include hundreds of alleged victims.

Simultaneously, the SEC has filed a civil enforcement action seeking restitution, asset freezes, and penalties.

What Happens Now?

Mattson’s trial could stretch for months, but the effects of his alleged actions will linger much longer. Investigators are still tallying the full extent of losses, and victims are urged to come forward with information. Authorities have created dedicated FBI intake portals to assist those affected.

As the justice system takes its course, one thing is clear: Kenneth W. Mattson didn’t just build developments he built a dream world. One now crumbling into dust.

IF YOU INVESTED WITH MATTSON:
The FBI is seeking information from individuals who invested in Divi Divi, Heacock Park, LeFever Mattson, or KS Mattson Partners LP. Visit the FBI’s official website to complete a confidential investor form or submit a tip by email.