Eau Claire man indicted for $35M scheme

Leader-Telegram (Eau Claire, WI)

Nov. 29—EAU CLAIRE — An Eau Claire man faces federal charges for defrauding banks while he made multi-million-dollar real estate deals.

Matthew T. Onofrio, 31, made his initial appearance a week ago in U.S. District Court in Minneapolis to face three charges of bank fraud.

Magistrate Judge Tony Leung agreed to let Onofrio free on his own recognizance while the case is pending, on the conditions the Eau Claire resident surrender his passport and not travel outside of Minnesota and Wisconsin.

The federal criminal case against Onofrio is seeking $35.7 million seized from a bank account during the investigation into the alleged bank fraud.

Between 2020 and August 2022, Onofrio executed his scheme to defraud multiple federally-insured banks, including MidCountry Bank, which is headquartered in Bloomington, Minn., according to a news release from the office of U.S. Attorney Andrew M. Luger.

Onofrio is accused of a variety of tactics in his Northwoods Management LLC business that involved lying to banks while he helped his clients invest in commercial real estate.

Among those is Onofrio wiring funds from his company to investors' accounts to temporarily increase their assets when they sought financing from banks. The funds would then be wired back to Onofrio.

Onofrio would also lend funds to investors — a practice referred to as the "seller carry" — to help them complete real estate buys, but this was not disclosed to banks that financed those deals.

Three specific wire transfers made to investor accounts between June 2021 and September 2021 are listed in the indictment to support the three counts of bank fraud Onofrio is charged with.

The indictment against Onofrio also accuses him of altering purchase agreements to support higher appraisals of properties. Those inflated appraisals were used to get larger loans from banks.

Onofrio's next date in court is an arraignment hearing scheduled for Jan. 13 in Leung's courtroom in Minneapolis

The case against Onofrio is the result of an investigation done by the FBI, IRS and Federal Deposit Insurance Corporation, according to the U.S. Attorney's news release.

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