A former transportation engineer for the Town of Chapel Hill is facing 23 counts of felony wire fraud and money laundering related to a Ponzi scheme he ran in the Indian-American community of Cary.
Kumar Neppalli, a 56-year-old Cary resident, was arrested Tuesday by the Federal Bureau of Investigation. According to a release by the U.S. Department of Justice, Neppalli’s crimes stemmed from calling or telling victims in-person about real estate investment opportunities — largely in Orange County, where he worked. Investigators say he “leveraged his employment with the town of Chapel Hill to convince victims that he had insider knowledge of development plans with respect to the purported real estate.” Neppalli would then request and take specific amounts of money from victims with the promise of returning the money with a profit a few months later. The release said the former engineer would also typically ask the victims to not discuss their transactions with others.
Kumar Neppalli, a former engineer for the Town of Chapel Hill, poses during the 2018 Staff Bike Ride. (Photo via the Town of Chapel Hill.)
In reality, the Department of Justice says Neppalli was taking those payments and returning it to other victims whom he’d previously taken money from.
“Our investigation shows Neppalli abused the trust and confidence placed in him by fellow Indian-American community members,” said Michael C. Scherck, FBI Acting Special Agent-in-Charge, in Tuesday’s release. “He promised to invest their money in property. Instead, Neppalli used the funds to pay back other people he swindled as part of his scheme; now, multiple victims are left without their much-needed savings.
“Fraud can have an immediate and direct impact on people and communities,” Scherck added, “and the FBI remains determined to bring those who commit it to justice.”
Neppalli retired from the Town of Chapel Hill in November 2021 after working for the local government more than two decades. Shortly before, one of the reported investors in Neppalli’s scheme reached out to the Chapel Hill Town Council and staff via email to alert them of his fraudulent borrowing.
Ran Northam, the town’s communications manager, told Chapelboro in late 2021 that the town was reviewing Neppalli’s activity as a town employee. Following Neppalli’s arrest, Northam said the town staff review did not find “irregularities regarding his work with the Town.”
If convicted on his 17 counts of wire fraud and six counts of “conducting transactions in criminally derived property,” Neppalli could face up to 20 years in prison per count and potentially additional fines. The full release from the U.S. Department of Justice can be found here.
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Former Town of Chapel Hill Employee Arrested on Fraud, Money Laundering ChargesA former transportation engineer for the Town of Chapel Hill is facing 23 counts of felony wire fraud and money laundering related to a Ponzi scheme he ran in the Indian-American community of Cary. Kumar Neppalli, a 56-year-old Cary resident, was arrested Tuesday by the Federal Bureau of Investigation. According to a release by the […]
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