Former Newberg restaurateur sentenced for bilking investors
James Frackowiak was sentenced to 60 months in prison and ordered to pay restitution by Clackamas County Circuit Court Judge Todd Van Rysselberghe for defrauding at least four elderly investors out of approximately $284,000.
Frackowiak, who lived in Canby but owned Frack Burger restaurants in Newberg and several other town, targeted former insurance clients and sold them interests in the Frack Income Fund, LLC, promising returns of up to 9 percent, the court found.
He mislead victims by failing to disclose that the fund consisted of his personal debts and had no potential for generating the promised returns.
The Oregon Division of Financial Regulation discovered the scheme after receiving a complaint from one of the victims about Frackowiak's insurance practices. The investigation revealed Frackowiak was withholding and combining client insurance premium payments. The division revoked Frackowiak's insurance producer license in 2017 and fined him $14,000.
The investigation into securities fraud began that same year. The division's enforcement team worked with the Clackamas County Sherriff's office and Clackamas County District Attorney's Office on the case.
"Collaboration at all levels of government service is essential for cases like this," said Andrew Stolfi, division administrator. "Before making any investment, we encourage Oregonians to do their homework, ask plenty of questions and be suspicious of offers that appear too good to be true."