SEC v. Kenneth Mattson, KS Mattson Partners LP — U.S. Securities and Exchange Commission Litigation Release No. 26312, dated May 23, 2025.
The SEC charged Kenneth Mattson, former CEO of LeFever Mattson, with operating a Ponzi-like scheme. He allegedly defrauded about 200 investors, many of them retired seniors, of at least $46 million by selling fake interests in real estate limited partnerships. Mattson commingled funds, made Ponzi-like payments, and misappropriated money for personal use.
In Plain English
Imagine someone selling you a piece of a real lemonade stand, but the piece they sold you isn't actually real. They took your money, mixed it with other people's money, and used it to pay off earlier investors, making it look like the stand was doing great. Meanwhile, they kept some of the money for themselves and didn't tell the real owners of the lemonade stand what was happening.
Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.
How the Alleged Scheme Worked
- Selling Fake Interests From approximately 2007 to April 2024, Kenneth Mattson offered and sold fake ownership interests in legitimate real estate limited partnerships managed by his company, LeFever Mattson. He falsely told investors these interests would entitle them to proportional distributions of income from the underlying properties.
- Targeting Vulnerable Investors Mattson specifically targeted approximately 200 investors, many of whom were retired senior citizens he met through his church community. He allegedly raised more than $46 million from these investors, particularly in the last five years since January 2020.
- Leveraging Real Partnerships The limited partnerships Mattson purported to sell interests in were real and invested in residential and commercial real estate. LeFever Mattson, his company, managed these partnerships, which were owned by a defined set of real investors.
- Concealing the Fraud To hide his scheme, Mattson used deceptive tactics. These included receiving investor documents via a personal post office box and using a bank account in the name of LeFever Mattson, which only he could fully access, to receive funds and send purported distributions.
- Keeping Fake Sales Secret Mattson kept documents related to his fraudulent scheme on his laptop and instructed his personal assistant not to discuss the defrauded investors with anyone else at LeFever Mattson. The fake sales were not reflected in the legitimate records of ownership for the real limited partnerships.
- No Actual Ownership Investors who purchased these fake interests never became actual limited partners or acquired any ownership rights. They also never received legitimate distributions from the partnerships they believed they had invested in.
- Commingling Funds Instead of investing the funds as promised, Mattson allegedly commingled new investor money with other personal and business funds in a bank account he controlled.
- Ponzi-Like Payments Mattson used the commingled funds to make Ponzi-like payments to existing investors, deceiving them into believing their investments were performing well.
- Misappropriating Funds He also misappropriated investor money to fund real estate transactions through his personal partnership, KS Mattson Partners LP, pay expenses for that partnership, and cover personal expenses.
- False Tax Records Mattson provided defrauded investors with false tax records, further concealing the true nature of their investments and the scheme's operations.
- IRA Solicitations Mattson encouraged investors to transfer funds from their individual retirement accounts (IRAs) to self-directed IRAs to invest in the purported limited partnership interests, which were not recorded in LeFever Mattson’s books.
The Enforcement Action
On May 22, 2025, the SEC charged Kenneth Mattson with operating a Ponzi-like scheme, defrauding approximately 200 investors of at least $46 million by selling fake interests in real estate limited partnerships. The SEC seeks permanent injunctions, disgorgement with prejudgment interest, civil penalties, and an officer-and-director bar against Mattson. KS Mattson Partners LP is named as a relief defendant, with the SEC seeking disgorgement of its ill-gotten gains. The complaint was filed in the U.S. District Court for the Northern District of California.
Named in this action: Kenneth Mattson, KS Mattson Partners LP.