A Prior Lake man has been charged with engineering a swindle in which he is accused of stealing $260,000 from a Georgia man who was attempting to buy a house from a woman in Ethiopia, and using a Burnsville bank to orchestrate the scheme.
Gavriil Papatakis, 43, is charged with felony theft by swindle, which carries a maximum penalty of 20 years in prison and a $100,000 fine.
According to the criminal complaint, police began investigating Papatakis in January 2011 after they learned that he had offered to facilitate a money transfer for an Atlanta man who was buying a house from a woman in Addis Ababa, Ethiopia.
The Georgia man traveled to Ethiopia in April 2009 to search for and buy a vacation home for his family. He found a property and agreed to buy the home from the owner for $260,000, and the man agreed to transfer the money from his bank in Atlanta to the seller’s bank in Ethiopia.
Shortly after he returned to Atlanta, the victim got a phone call from Papatakis, who told the man that he was married to the seller’s niece.
Papatakis told the buyer that he was licensed to transfer money between countries, and he offered to help facilitate the sale in a shorter amount of time and with fewer fees than it would normally take, according to the complaint.
Papatakis said the seller’s husband was ill, and she needed the money quickly to help pay for his care, the complaint says. The buyer told police that he had met the woman’s husband and knew that he was ill.
The buyer contacted the woman in Ethiopia, who confirmed that Papatakis was a family member and said she believed he could be trusted to help with the transaction.
On May 8, 2009, the buyer transferred $260,000 from his Georgia bank to Papatakis’ bank in Burnsville. In the days after the transfer, Papatakis told the buyer that he had received the money and promised to wire it to the seller.
However, Papatakis did not transfer the money, and for the next several months he continued to tell the buyer various stories: that he had transferred the money, that the money would be transferred soon, and finally that he planned to take the money personally to Ethiopia, according to the complaint.
In November 2009, Papatakis went to Ethiopia and met with the seller. He told her that the money had been seized by customs agents in Amsterdam and that he “had to escape to Germany by train,” according to the complaint.
After that, the buyer and seller continued to try to contact Papatakis so the transaction could be completed. The money was never transferred, according to court documents.
Authorities reviewed Papatakis’ bank records and learned that he deposited the $260,000 into his savings account on May 8, 2009. On the same day, he opened a personal checking account and transferred the entire amount into the new account.
Between May 8 and Oct. 28, 2009, Papatakis withdrew $260,000 from the checking account, either by making large cash withdrawals or writing checks to himself, other individuals or to a stock trading company, the complaint charges.
Papatakis came to the Burnsville police station twice, on May 4 and May 5, 2011, and gave statements to police. He initially denied any knowledge of the transaction, but then admitted that he knew about it and that the seller had originally contacted him, asking him to make the transfer, the complaint says.
Papatakis denied operating a hawala – an informal system in which money brokers transfer money without using traditional banking or financial channels – and denied telling the buyer that he was licensed to transfer money, according to the complaint.
He admitted receiving the $260,000 and then gave “several different convoluted accounts of how he transferred the money to [the seller] through numerous different individuals and transactions,” according to the complaint.
Papatakis admitted that he had written himself a check for $135,000 to invest in the stock market, but he told police that the seller was lying about not receiving the money because she was having an argument with his wife. “[Papatakis} could not explain why [the seller] would lie,” the complaint notes.
Papatakis, who has not been arrested, is scheduled to make a first appearance on the charge June 25 in Dakota County District Court in Hastings. A judge last week ordered his financial assets frozen.