Leslie Clark Stipek

About Michael Eugene Kelly

Michael Kelly is accused of operating a $484 million dollar ponzi scheme.

Michael Eugene Kelly was arrested by the FBI on December 22, 2006 in Florida. The arrest was made just before his discharge from the Mayo Clinic where he was being treated for a heart condition. Kelly was denied bail and is currently in the Metropolitan Correctional Center in Chicago. Since his incarceration in Dec 2006 Kelly has been attempting to avoid indictment by arranging a plea deal. On May 9, 2008 the Deparment of Justice charged Michael Kelly with 14 counts of fraud.

May 9, 2008
United States Attorney's Office Charges Michael Kelly with 14 Counts of Fraud

The complaint charges Kelly with 10 counts of mail fraud, 2 counts of wire fraud and 2 counts of securities fraud and also seeks the forfeiture of approximately $500 million in assets. If convicted, 10 of the mail and wire fraud counts each carry a maximum penalty of 20 years in prison and a $250,000 fine, while two other mail fraud counts each carry a maximum of 5 years in prison and a $250,000 fine. The two securities fraud counts each carry a maximum penalty of 10 years in prison and a $250,000 fine. As an alternative, the Court may impose a maximum fine equal to twice the loss to any victim or twice the gain to any defendant, whichever is greater. Restitution is mandatory and the Court would determine the appropriate sentence to be imposed under the advisory United States Sentencing Guidelines.

On May 14, 2008 Michael Kelly pled not guilty and was escorted back to his jail cell in the Metropolitan Correctional Center.

Michael Eugene Kelly remains in the custody of the Bureau of Prisons.

Sept 5, 2007
SEC files charges against Michael E. Kelly, Michael P Kelly, Donald L Kelly and 23 others.

The Detention Hearing to determine if Michael Kelly will be let out on bail was held on Feb 20, 2007. The documents below (2-9-2007) were submitted by Kelly's lawyers to persuade the judge to allow Kelly to be let out on bail. The exhibits consist of affidavits from Kelly's father, wife, daughter, friends and doctors stating their concern for Kelly's health and pleading for his release. His wife Lory describes the arrest of Kelly at the Mayo Clinic in Florida after being treated for his heart condition. Kelly's doctors detail his medical condition and express their concern for Kelly's health and the effect being incarcerated is having on him. Friends of Kelly swear under oath that he is a great guy and will show up for court of they let him out on bail. Kelly's father Leonard states that he has never seen Kelly look so ill.

The government's response below (2-16-2007) includes detail on the overwhelming case against Kelly. Kelly claims that he only makes $55,000 a year and has meager $48,000 in assets. The government response includes the fact all of Kelly's assets are outside the US and he would have no incentive to remain in the US if let out on bail. Kelly is a citizen of the US, Mexico and Belize which could make extradition difficult or impossible if he were to flee. If convicted of all of the current charges he will face 53 years in jail which is effectively a life sentence. Exhibit 3 of the response includes compelling testimony from the victims of Michael Kelly. They describe the financial difficulties they have faced while Kelly lived a life of luxury on their money.

If you suspect that you are a victim in this case and have not already received a victim survey from the U.S. Attorney’s Office, submit your name and address to usailn.victim.mk@usdoj.gov. Persons without internet access may call a toll-free number – (866) 364-2621 – and leave a message with the spelling of their name and an address, and a form will be mailed to them within two weeks.

For updates on the case, call toll free: 866-364-2621

Victims can sign up for email notification of changes in the case using the DOJ website at: www.notify.usdoj.gov

Criminal Case Information

Case 1:06-cr-00964
Northern District of Illinois
USA v. Kelly
Federal Inmate Locator for Mike Kelly

12-22-2006	Michael Kelly arrested at Mayo Clinic in Florida after being treated for heart condition FBI Complaint Against Michael Eugene Kelly

12-27-2006	Pretrial Services in Florida. Kelly reserved right to move hearings to Illinois FBI Press Release - Suspect in Ponzi Scheme Arrested in Florida

1-16-2007	US Attorney Motion for Extension of Indictment to 3-22-2007 at the latest. Motion

1-18-2007	Pretrial Services in Chicago. Kelly reveals that he became a Mexican citizen and was informed of his treaty rights.

1-22-2007	Kelly changed attorneys.

1-26-2007	Kelly requested continuance of the detention hearing until 2-13-2007

2-9-2007	Defendants Motion For Release On Bail Pending Trial Motion Exhibit Index Exhibits A-H Exhibits I-M

2-13-2007	Government given until 2-16-2007 to file response to motion.

2-16-2007	Government's Response To Defendant's Motion For Release On Bail Motion Affidavit Exhibits 1 - 2 Exhibit 3 (part 1) Exhibits 3 (part 2) - 4

2-20-2007	Detention Hearing Results: Magistrate Judge Michael T. Mason has ordered defendant Michael Kelly to remain in the custody of the Bureau of Prisons.

3-20-2007	Michael Kelly added another attorney, Jeffrey B. Steinback, to his council. Due to the attorney change, Michael Kelly has requested additional time until the indictment is returned. The deadline to return the indictment has been changed to May 16, 2007.

5-8-2007	At the request of his attorney, Michael Kelly was granted a third extension of time to seek the return of an indictment or to file an information. Kelly's lawyer claims that he will be traveling to Mexico to obtain information to obtain information relevant to the case. The time to file an indictment or information is extended to and including July 19, 2007. Motion Order on Motion Order

5-11-2007	Latham & Watkins LLP hereby moves this Court to withdraw the appearances of Robert W. Tarun, Deborah L. Steiner, and Meghan H. Sullivan. Motion to withdraw as attorney Notice Order

7-11-2007	Michael Kelly has requested additional time until the indictment is returned...The deadline to return the indictment is on or before Sept 28, 2007.

9-5-2007	SEC files charges against Michael E. Kelly, Michael P Kelly, Donald L Kelly and 23 others. SEC Press Release Complaint

9-25-2007	Michael Kelly wants to arrange a plea agreement. Time is needed to explore possible terms including payment of restitution which potentially includes money and assets outside the US. The government has agreed to postpone his indictment until Nov 9, 2007. Michael Eugene Kelly remains in the custody of the Bureau of Prisons. Motion for Extension Extension Order

11-6-2007	Sixth extension of time to return indictment. Michael Kelly continues delay his indictment with promises to repay investors with assets outside the US. The DOJ is reviewing 30 boxes of documents provided by Michael Kelly through council. The government has agreed to postpone his indictment until Jan 11, 2008. Motion for Extension Motion for Extension - Amended Order

1-11-2008	Kelly requested an extension for the following reasons: (1) the defendant through counsel has requested an additional opportunity to make a proffer of information to the government relating to the matter under investigation; (2) the defendant through counsel has submitted a draft proposed restitution plan, including the identification of assets to be liquidated for the benefit of victims, which draft proposal is currently under review by the government; (3) the defendant through counsel has been providing to the government supporting documentation for the draft proposed restitution plan, much of which is in Spanish; (4) the defendant seeks additional time to refine his draft proposal and to produce to the government additional information from Mexico and Panama in support of the draft proposal; and, (5) the defendant through counsel also seeks additional time to negotiate the terms of a plea agreement, in addition to the restitution provision mentioned above. The defendant contemplates pleading guilty as a part of any plea agreement. Neither Michael Kelly's counsel or the US Attorney anticipates a further extension of time beyond February 8, 2008. Motion for Extension Motion for Extension - Amended Order

2-5-2008	Eighth extension of time to return indictment. The government has agreed to postpone the indictment until April 4, 2008. Motion for Extension Order

3-26-2008	Ninth extension of time to return indictment. The government has agreed to postpone the indictment until May 9, 2008. Motion for Extension Order

5-9-2008	Michael Kelly charged with 10 counts of mail fraud, 2 counts of wire fraud and 2 counts of securities fraud. The United States Attorney's Office also seeks the forfeiture of approximately $500 million in assets. Felony Charges Department of Justice Press Release SEC Press Release

5-14-2008	Michael Kelly pled not guilty and remains in the custody of the Bureau of Prisons.

6-10-2008	Information hearing scheduled

Attorneys
Plantiff USA		Defendant Michael Eugene Kelly

AUSA United States Attorney's Office (NDIL) 219 South Dearborn Street Suite 500 Chicago, IL 60604 (312) 353-5300 USAILN.ECFAUSA@usdoj.gov Assigned: 12/22/2006		Martin W. Kus Newby, Lewis, Kaminski & Jones 916 Lincolnway LaPorte, IN 46352-1816 (219) 362-1577 Assigned: 01/12/2007 TERMINATED: 01/22/2007

Edward G. Kohler United States Attorney's Office (NDIL) 219 South Dearborn Street Suite 500 Chicago, IL 60604 (312) 353-5300 edward.kohler@usdoj.gov Assigned: 12/22/2006 LEAD ATTORNEY		Deborah L. Steiner Latham & Watkins LLP (IL) 233 South Wacker Drive 5800 Sears Tower Chicago, IL 60606 (312)876-7700 deborah.steiner@lw.com Assigned: 01/19/2007 TERMINATED: 05/14/2007 LEAD ATTORNEY

Pretrial Services. 435-5545 ilnptdb_Court_Action_Notice@ilnpt.uscourts.gov Assigned: 12/22/2006		Meghan H. Sullivan Latham & Watkins LLP (IL) 233 South Wacker Drive 5800 Sears Tower Chicago, IL 60606 (312) 777-7010 (312) 993-9767 (fax) meghan.sullivan@lw.com Assigned: 01/19/2007 TERMINATED: 05/14/2007

		Robert Walter Tarun Latham & Watkins LLP (IL) 233 South Wacker Drive 5800 Sears Tower Chicago, IL 60606 (312) 876-7700 robert.tarun@lw.com Assigned: 01/19/2007 TERMINATED: 05/14/2007

		Jeffrey Bruce Steinback Law Offices of Jeffrey B. Steinback 53 W. Jackson Blvd #1420 Chicago, IL 60604 (847)624-9600 jbs.law@insightbb.com Assigned: 03/20/2007

Civil Case Information

Universal Lease Program Claims

Web Post from Ernest Bustos

Kuhlman vs. Kelly

Robert Rivas is a lawyer that is pursuing a civil suit against Michael Kelly and Resort Holdings International on behalf of the clients of Les Stipek. If you invested with a broker other than Les Stipek, do not contact Robert Rivas. Robert Rivas is only representing clients that invested through Les Stipek.

Adorno Yoss Alvarado & Smith
Attn: Robert Rivas
4 Park Plaza, Suite 1200
Irvine, CA 92614
949-955-6800
rrivas@adorno.com

Media Coverage
Chicago Tribune	Jet, boats, 3 passports add up to no bond
WNDU TV	Michael Kelly Faces Fraud Charges (Video)
WSBT TV	Local Woman Still Trying To Recover Money After Scam (Video)
Chicago Tribune	Mexico hotel owner charged in swindle of time-share leases
The Detroit News	Investors out $10M say state slow to act
Santa Cruz Sentinel	County residents among alleged victims of international scam
Autoweek	Avanti Arrest - Chairman's arraignment clouds Avanti's comeback
Fonatur	Press Release from Mexico's National Trust Fund for Tourism Development This is in response to Michael Kelly's arrest on Dec 22. It is in Spanish and was released Jan 3, 2007.
Puerto Cancun	Press Release Declaring Puerto Cancun is a solid and trustworthy development. This was released Dec 29, 2006 and is in response to Michael E. Kelly's arrest. Michael E. Kelly is President and CEO of Puerto Cancun.
Denver Post	Boulder man ordered to repay seniors in fraud

Michael Kelly's Newest 100' Yacht "Time"

Michael Eugene Kelly

Also Known As

Michael Eugene Kelly
Michael E Kelly
Michael Kelly
Mike Eugene Kelly
Mike E Kelly
Mike Kelly, Sr.
Mike Kelly
Michael Eugene Kelly Hodgson
Michael E Kelly Hodgson
Michael Kelly Hodgson

DOB

Oct 6, 1949

Family

South Bend, Indiana

Wife

Lory Kelly
aka
Laura Kelly
Lory Lueth

Daughter

Lori Kelly Levi

Daughter

Gwen E. Beem
aka
Gwen Beem
Gwen E. Kelly
Gwen Kelly

Villa Rica, Georgia
Walkerton, Indiana

Son

Michael Paul Kelly
aka
Michael P Kelly
Michael Kelly, Jr
Mike Paul Kelly
Mike P Kelly
Mike Kelly, Jr.
Mike Kelly

Son

Donald Kelly
aka
Donald L Kelly
Don Kelly

Father

Leonard A. Kelly

Lakeville, Indiana
Morrow, Georgia

Mother

Anne Sue Kelly

Sister

Linda Lipp
(son Ryan Lipp is involved with Puerto Cancun project)

Business Names

Yucatan Resorts S.A.
Yucatan Resorts, Inc.
Yucatan Investment S.A.
Yucatan Leases
Yucatan Investment Corp
Yucatan Nine Month Note
Yucatan Properties, S.A. DE C.V.
Azzurriccio, S.A. DE C.V.
Resort Holdings International
Puerto Cancun
Avalon Baccara
Avalon Bay Hotel Majesty Travel
Avalon Resorts
Avalon Reef Club
Avalon Vacations
Avalon Excalibur Alcapulco
Avalon Grand Panama
Avalon Grand Hotel
Hotel Baccara
World Phantasy Resorts, Inc
World Phantasy Tours
Majesty Travel
Fantasy Travel
Fantasy Tours
Galaxy Property Management
Galaxy Properties Management, S.A.
Viajes Majesty
Isla Mujeres
The City (Cancun)
Avanti Motor Corp.
Corporativo Nolo, S.A.
Operadora Hoteles Grand S.A.
Josefine's Clubs (brothel and strip club chain in Panama)
Club Baccara
Universal Lease Servicing Agreement
Universal Lease Program
Groupo Kelly
Cancun Golf Club at Pok ta Pok
Zipp Rent-A-Car
Panorama Communities, S.A.
DMK Properties, LLC

Associates

Patrick Ballinger
John L Corwin		Mgr Cancun Universal Lease office
Gabriel Escalante		President and Director of World Phantasy
Beatriz Solorzano
David Sharples		President of Avanti Motors
Scott Bakay		Wall Street Associates
George Diamond		Wall Street Associates
Tom Weiskopf

Brokers

Leslie Stipek		Stipek Financial Services, LLC
James Catledge		Net Worth Solutions
Mark Ruttenberg		Ruttenberg & Associates Financial Marketing Inc
Ted J. Reinoehl		Ruttenberg & Associates Financial Marketing Inc
Richard H. Greene		Ruttenberg & Associates Financial Marketing Inc Camelot Group, Inc.
Robert Jerry Martin, Jr.
Mark G. Meyer		Mark Meyer & and Associates
Richard E. Riner		Soutwest Income Marketing, Inc
Carl Q. Lee		Carl Lee and Associates
Warren T. Chambers		Century Estate Planning, Inc.
William K. Boston		Century Estate Planning, Inc.
Donald Wesley Dennett
Neil S. Moderson
Richard L. Troyer
Carl R. Todd
Freeman Owen		Financial Sources, Inc.
Janalee Ranney Sneva		Sneva Alliance
Ronald D. Morley		Main Street Estate Group, Inc.
Martin J. Beeson		Mid-Atlantic Estate Planning
Joseph S. Schwalm		Allegheny Investments, LTD
Bruce E. Fleming, Jr.
Diane J. Burda		Main Street Estate Group, Inc.
Rodney Hinkle		Preferred Marketing, LLC RLH Financial Services
George Lin Phelps		Safe Estate Plans
Steve J. Cottrell		Senior Life Asset Management
Debra Aragon		Emerald Majestic International Inc
Jacqueline Marazzi		J.M. Business Services
Rod Rieman		Innovative Financial
Jeffery J. Kain
James E. Sundelius
John J. Zaczek
Roy Dean Higgs
Michael B. Maksudian		Wealth Management Resources, Inc
Betty Maksudian		Wealth Management Resources, Inc
Michael A. Diaz		Wealth Management Resources, Inc
Lorrina Diaz		Wealth Management Resources, Inc
		Lawson Marketing and Consulting
		InterMountain Agency
John Edward Tencza		American Elder Group, LLC
Christine M. Tencza		American Elder Group, LLC
Phillip Robert Ohst		American Elder Group, LLC
Mary Elizabeth Ohst		American Elder Group, LLC
Gregory Grant Groh		American Elder Group, LLC
Gail A. Groh		American Elder Group, LLC
John Donovan		American Elder Group, LLC
John R. Wustner
Veronica "Ronni" Kishlansky
Carma Turanich		Wall Street Associates

Louis W. Welt
Troy Wesley Dennett
Michael Bucchianeri		Sonoma Financial Group LLC

Current Address

Metropolitan Correctional Center (MCC)
Chicago, Illinois

Previous Address

Cancun, Mexico
Panama City, Panama

Puerto Cancun Warning

Michael Eugene Kelly, the President and CEO of Puerto Cancun, accused of defrauding investors out of several hundred million dollars. Kelly is in jail in Chicago waiting to be prosecuted. In the FONATUR press release, the Mexican government states that Puerto Cancun is a safe and secure investment. If you are considering investing in Puerto Cancun you are advised to have a trustworthy Mexican lawyer review all contracts. We have received reports of shady dealings related to the Puerto Cancun development.

One individual purchased a time share in Avalon Grand Cancun in Dec 2006 (prior to Kelly's arrest) for $11,000. He returned home the next day and found information on the Internet about Michael Kelly's previous investments in which the investors lost their money. He contacted Avalon Grand Cancun to cancel his purchase of the time share. He was told that there was a 50% cancellation charge and he would need to return to the resort in Cancun to get it. Luckily he charged the $11,000 on a credit card and the bank would not allow the charges to go through. They attempted to charge his card 20 times and it was denied each time. The contract he signed included a non-cancellation clause. He consulting a lawyer and found out that under Mexican law you unable to give up the right to cancellation even if you choose to do so. This is part of a Mexican consumer protection act. Under Mexican law, you have 5 days from the time you sign a timeshare contract to cancel. This is guaranteed by Mexico's consumer protection agency, PROFECO. He had to have several formally written letters sent to PROFECO and the resort within this window. PROFECO was extremely helpful but the resort declined any kind of hand delivery, which was tried several times.

If you found this page because you invested with Michael E Kelly or one of the businesses listed above, you are recommended to contact the U.S. Attorney's Office.

If you found this page because you have reservations or plan on staying at one of the resorts listed above, do not be alarmed. The incarceration and suspected criminal acts of Michael E Kelly will most likely have no effect on your plans. The businesses are still running, the issue is that the investors that paid for the development are not being paid returns for their investment.