A San Diego man charged with running an investment fraud scheme and taking millions in ill-gotten pandemic loan funds was convicted by a San Diego federal jury last week of more than two dozen counts of securities fraud, bank fraud, and money laundering. Denny Bhakta, 42, was first charged with soliciting investments for his companies, Fusion Hotel Management LLC and Fusion Hospitality Corp., then using investors’ funds on personal expenses — such as gambling and purchasing vehicles — and to pay off other investors, according to the San Diego U.S. Attorney’s Office. Prosecutors said that in one particular gambling outing that lasted 7½ hours, he lost $1 million. Prosecutors said investors were told Bhakta’s companies would purchase discounted blocks of hotel rooms from Hilton, then sell those rooms for a profit to United Airlines and other companies. Bhakta provided fabricated bank records and fake agreements with Hilton and United Airlines to make Fusion’s purported business dealings appear legitimate, according to prosecutors, who said Bhakta took around $35 million from investors. Among the investment fraud victims were Bhakta’s uncle, who lost $4.5 million, as well as Bhakta’s friends and other family members. “This sophisticated scheme unraveled after several victims came forward and exposed the fraud,” San Diego U.S. Attorney Tara McGrath said in a statement. “Many of the victims are people who represent the best of us — hard working, honest Americans who made investments based on a trusted relationship. The jury’s verdict is a resounding affirmation that justice will prevail over deceit.” Two years after the investment fraud charges were filed, federal prosecutors charged Bhakta in connection with 18 Paycheck Protection Program loans he applied for, totaling $4.4 million. Prosecutors allege Bhakta misrepresented his businesses’ payroll expenses, number of employees, and how the money would be used. He also used some of the investment fraud victims’ names to claim they were Fusion employees in order to secure the loans, prosecutors said. Bhakta, who is also facing a civil action from the U.S. Securities and Exchange Commission, is slated for sentencing in January.