A Petaluma real estate agent was arrested Tuesday on suspicion of stealing more than $20 million from dozens of investors in a Ponzi scheme, according to officials in the Sonoma County District Attorney's office.

Aldo Baccala, 71, was charged with 167 felony counts of grand theft, securities fraud and elder abuse and was being held on $2 million bail at the Sonoma County Jail, District Attorney Jill Ravitch said.

Through his business, Baccala Realty, Inc., Baccala raised millions of dollars from investors for East Coast nursing homes and a Colusa County mushroom farm, officials said.

Baccala promised more than 12 percent annual returns for investments in projects to be secured by a first or second deed of trust on the property, according to the arrest declaration. However the funds raised were not used as Baccala promised and none of the promised deeds of trust recorded, Ravitch said.

Baccala's debts mounted after he lost about $8 million of investors' money in the stock market between 2003 and 2008. He began promising new investors annual returns of up to 27.5 percent to cover interest payments to earlier investors, Ravitch said.

More than 75 investors sued Baccala after he sent letters in 2008 saying that he would no longer make promised monthly payments. They settled in 2009 for $21 million in the civil case.

Many of the victims are elderly and have known Baccala's family for years, Ravitch said.

Their complaints led the District Attorney's office, assisted by the Attorney General's office, to launch an investigation into Baccala's dealings in January 2009.

They found "a pattern of theft and fraud which resulted in a loss of more than $3.2 million. We intend to seek justice for Sonoma County residents who suffered tragic losses in a fraudulent scheme," Ravitch said in a statement.

"This Ponzi scheme caused dozens of investors to lose the money they thought they would be securing and investing," Attorney General Kamala D. Harris said. "It is important to protect investors from being duped by false representations from criminal actors."

District Attorney and state prosecutors will jointly prosecute the case.

Victims in the case can find more information about the matter at:


You can reach Staff Writer Julie Johnson at 521-5220 or julie.johnson@pressdemocrat.com.