Federal prosecutors in the Northern District of California are negotiating a plea agreement with Ken Mattson, a Sonoma-area real estate investor charged with wire fraud, under which Mattson would plead guilty to a single count and face a sentence capped at 12 years in prison [1]. A change-of-plea hearing was scheduled for May 11, 2026, though the parties had not finalized the agreement as of the announcement [1]. Full restitution to victims is a required term of the proposed deal [1].
Authorities have characterized the scheme as a classic Ponzi structure in which investor funds were misappropriated rather than deployed as represented [1]. Mattson built a prominent profile in the Sonoma real estate market before the fraud allegations emerged, and the case drew substantial attention among California's investor community [1]. Wire fraud under 18 U.S.C. § 1343 carries a statutory maximum of 20 years per count for offenses not involving financial institutions, making the proposed 12-year cap a negotiated ceiling below that maximum. A single-count plea, if accepted, would narrow the government's sentencing exposure while obligating Mattson to disgorge funds to harmed investors.
The Securities and Exchange Commission filed a parallel civil action and has placed it in abeyance pending resolution of the criminal matter [1]. That sequencing is standard practice, allowing the criminal case to proceed without triggering Fifth Amendment complications that could arise from simultaneous civil discovery. The SEC's civil claims remain live and would likely be reactivated, with any restitution order from the criminal case potentially informing the civil remedy calculation.
The May 11 hearing date gives both sides a near-term deadline, but plea negotiations in complex fraud cases frequently extend past scheduled change-of-plea dates. If the agreement collapses, the case returns to a trial posture in the Northern District. If Mattson enters the plea as proposed, sentencing would follow on a separate schedule, with the restitution amount to be determined, a figure that could prove significant given the reported scale of investor losses [1].