A Nevada man pleaded guilty yesterday to one count of wire fraud stemming from his role in a years-long fraud scheme, during which he stole more than $6.1 million in victim investor funds.
According to court documents, Mykalai Kontilai, formerly Michael Contile, 55, of Las Vegas, facilitated an investment fraud scheme involving his company, Collector’s Coffee Inc., doing business as Collector’s Café (Collector’s Coffee), a company incorporated in California and headquartered in Las Vegas. From 2012 to 2018, Kontilai made or caused to be made numerous materially false and misleading representations to induce victims to invest in Collector’s Coffee – a company he claimed was on the verge of launching an online auction house for third-party owned collectibles, such as Hollywood and sport memorabilia. As a result of Kontilai’s numerous false and misleading statements, including that investor funds would be used for legitimate business purposes, that Kontilai had personally invested millions of his own money in the company, and that he did not take a salary, Kontilai successfully raised approximately $23 million from Collector’s Coffee investors. However, rather than using the proceeds as represented, Kontilai stole approximately $6.1 million for his own personal use, including for the purchase of luxury goods, apartments, and vehicles.
The U.S. Securities and Exchange Commission (SEC) began investigating Kontilai for misappropriating investor funds in or around 2017. Kontilai obstructed the investigation by forging documents that he caused to be transmitted to the SEC and lied under oath to the SEC. Kontilai was charged in connection with this conduct both in the present case on June 3, 2020, and in a separate case in the District of Colorado on March 10, 2020. While under investigation but prior to charging, Kontilai fled to Russia and was ultimately arrested on an Interpol Red Notice in Germany in 2023. He was extradited back to the United States to face the pending charges in May. As part of the plea agreement in this case, the government will move to dismiss the Colorado case at sentencing.
Kontilai pleaded guilty to one count of wire fraud. He is scheduled to be sentenced on Dec. 4 and faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division; U.S. Attorney Jason M. Frierson for the District of Nevada; Special Agent in Charge Spencer L. Evans of the FBI Las Vegas Field Office; and Special Agent in Charge Carissa Messick of IRS Criminal Investigation (IRS-CI) made the announcement.
The FBI and IRS-CI are investigating the case. The Justice Department’s Office of International Affairs provided significant assistance in securing the extradition from Germany of Kontilai.
Trial Attorneys Brandon Burkart and Sara Hallmark of the Criminal Division’s Fraud Section (FRD) and Assistant U.S. Attorney Jessica Oliva for the District of Nevada prosecuted this case. Former FRD Trial Attorney Emily Scruggs provided valuable assistance.