John Santilli also awaits sentencing in $4.2M ‘Magic Mike’ fraud
East Greenwich man John Santilli, 49, was found guilty Oct. 3 of defrauding a British investor of $100,000 in a film scam. The verdict came after a two-day jury trial in Providence Superior Court before Justice Luis M. Matos.
The state argued that Santilli defrauded an investor from the United Kingdom out of $100,000 for what the investor thought was going toward a film project based on the 1990’s HBO series “Tales from the Crypt.” Santilli then spent large sums of the investment money at various regional casinos, according to Attorney General Peter Neronha.
He is due to be sentenced Dec. 8.
Meanwhile, Santilli is facing a much larger case out of California, where he pleaded guilty in October 2022 to one count of securities fraud and one count of wire fraud.
According to his California plea agreement, Santilli managed and partly owned Aloris Entertainment, LLC, which acquired an interest – through securities called “Class A Units” – in Mike’s Mobile Detailing, LLC, the company that operates the “Magic Mike Live” stage show, which is based on two “Magic Mike” movies that chronicle the life of a male stripper.
From June 2016 to February 2020, Santilli raised funds from victims by soliciting investments in “Aloris Magic Mike LP,” a different business that he falsely told investors owned the Class A Units. Santilli lied to investors, telling them that, in return for their investment, they would receive “shares” in Aloris Magic Mike LP that corresponded to a particular number of Class A Units and entitled them to a percentage of the profits from “Magic Mike Live.” To bolster his false claims, Santilli used a doctored legal document that made it appear that Aloris Magic Mike LP was a shareholder of Mike’s Mobile Detailing.
Santilli misappropriated a significant portion of his victims’ investments, including withdrawing more than $1 million at casinos across the United States, where he used investors’ money for gambling. To raise more funds, Santilli falsely told his victims that new investment opportunities had arisen, resulting in Santilli selling shares in his businesses that corresponded to nearly double the number of Class A Units of Mike’s Mobile Detailing that his company actually owned.
In total, Santilli caused approximately $4,258,679 in losses to his victims.
Santilli faces a statutory maximum sentence of 40 years in federal prison. There is no sentencing date at this time; it has been postponed at least twice in the past year.
In the Rhode Island case, Rhode Island State Police initiated an investigation following a report from the victim’s attorney alleging the defendant had defrauded her client of $100,000 in a movie production deal gone wrong. Santilli has produced films, including Bill & Ted Face the Music in 2020.
According to the AG’s office, the victim entered into a contract with the defendant and his company, Aloris Entertainment, LLC, that stipulated the victim would finance the defendant’s remake of the HBO series “Tales from the Crypt” for $350,000. The victim wired the defendant approximately $100,000 in seed-funding to begin organization of the film project.
After time elapsed with no reported progress on the production of the film, the victim reached out to friends in the film industry and eventually discovered the project was fraudulent.
Investigators reviewed copies of the defendant’s bank records that revealed that shortly after the victim’s money was deposited, the defendant transferred a portion of the funds from his Aloris Entertainment, LLC account to his personal banking accounts. The bank records also revealed that the defendant withdrew money from the Aloris accounts at Twin River Casino, Foxwoods Casino, and Mohegan Sun Casino on several different occasions between April 2018 and September 2018. Moreover, investigators could not find any expenditures related to the production of a movie.
Santilli was arrested in June 2020.
“This case is a compelling example of something that Rhode Islanders deal with every day,” Neronha said. “Whether it’s swindling hundreds of thousands of dollars from an overseas investor, or a simple email solicitation to an unsuspecting victim, scammers are always finding new, increasingly sophisticated ways to steal from hard-working folks. I’m grateful that justice was served in this case, and hope it serves as a reminder to Rhode Islanders to stay vigilant. And as always, I want to thank the Rhode Island State Police for their partnership in investigating this case and bringing the defendant to justice.”
Special Assistant Attorney General John Malloy and Sergeant Matthew P. McGuire of the Rhode Island State Police led the investigation and prosecution of this case.