Fraudulent developer imprisoned for spending over $500,000 of investor’s funds on vacations and mortgage

HOUSTON – A 48-year-old Houston resident has been sentenced for wire fraud, announced U.S. Attorney Alamdar S. Hamdani.

Walter Salek pleaded guilty April 5 to his involvement in a fraudulent scheme to obtain more than $1 million and falsely informing an investor the funds would be used to develop real estate.

U.S. District Judge Sim Lake has now ordered Salek to serve 15 months in federal prison to be immediately followed by three years of supervised release. He must also pay the victim $571,000 in restitution. At the hearing, the court heard additional testimony from the victim that described how Salek portrayed himself as a successful real estate developer who flew around in private jets and was letting the victim in on investments that before had only been available to Salek’s family. The victim testified that the worst part was not the fraud, but that Salek betrayed his trust by taking his money when Salek knew the victim’s wife was dying and leaving him with three children to raise. In handing down the prison sentence, the court noted that Salek’s claim he engaged in the fraud during a “manic episode” could not be true because the fraud and cover-up went on for years.

“Walter Salek took money from a friend who was in the midst of a family tragedy,” said Hamdani. “Instead of investing the money, he used it to live an extravagant lifestyle that included things like traveling by private jet, a $100,000 family vacation to Scotland and mortgage payments on a brownstone in Boston and his multi-million dollar house here in Houston. Today’s sentence demonstrates that everyone, even people living like the top 1%, will be held accountable for their criminal conduct.”

“Walter Salek committed clear-cut fraud, lived a care-free life until he got caught and will now spend time in federal prison for his crime,” said Special Agent in Charge Douglas Williams of the FBI Houston field office. “Salek took advantage of a friend’s long-time trust and money to invest in his fraudulent property ventures. He let his personal greed supersede that friendship and any potential opportunity for lawful prosperity.”

At the time of the plea, Salek admitted between 2019 and 2021, he entered into agreements with an investor to develop real estate in the Houston area. As per the agreement, Salek was to contribute real estate and the investor was to provide cash to develop the properties. Once developed, properties were to be either leased or sold.

The investor believed the funds would be used for the developments and deposited over $1 million into business bank accounts that Salek controlled through use of interstate wire communications. However, Salek diverted at least $571,000 of the investment funds for his own personal use on mortgage payments and luxury vacations.

Salek was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.

The FBI conducted the investigation. Assistant U.S. Attorney Belinda Beek prosecuted the case.