Seal Beach Woman Gets 3 Years for Defrauding Real Estate Investors

A 48-year-old Seal Beach woman who pleaded guilty operating a $1.4 million scheme that defrauded clients promised ownership stakes in commercial real estate was sentenced today to 35 months in federal prison, authorities said.

Karen Hanover pleaded guilty in 2014 to one count of mail fraud in connection with the scheme, which was run out of two Long Beach-based companies, Commercial Investment Education LLC and Kharmic Life Strategies Inc., said Thom Mrozek, public affairs officer for the U.S. Attorney’s Office.

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Victims who were induced to invest between $19,000 and $29,000 were recruited at seminars in Southern California, Dallas and Las Vegas, he said.

They were falsely promised by Hanover that she would partner with them in real estate deals that would pay them 100 percent returns, Mrozek said.

Hanover promised investors they would get a 100 percent refund if they did not obtain a commercial property with a year, Mrozek said.

Some victims used borrowed money, others all of their savings, but when they demanded their funds be returned, Hanover bullied and intimidated them, threatening that some would end up in jail if they reported her, Mrozek said.

U.S. District Judge Josephine Staton scheduled a May 8 hearing to determine how much restitution should be paid to Hanover’s 45 victims, Mrozek said.

Hanover was sentenced in U.S. District Court in Santa Ana.

Hanover was also found guilty at trial in 2011 of impersonating an FBI agent while contacting victims of her fraud scheme, using a phone number made to appear it was associated with the FBI and threatening victims with arrest if they divulged her fraudulent conduct, Mrozek said.

That case resulted in her being sentenced to six months in prison and fined $5,000, Mrozek said.

• City News Service