Real estate developer Todd Hitt, CEO of Falls Church-based Kiddar Capital, surrendered to the FBI Friday on an outstanding arrest warrant in connection to securities fraud charges, according to the U.S. Department of Justice.
Hitt, whose company is co-developing the big, new mixed-used project at Rt. 7 and 29 in the City, is alleged to have falsely claimed Kiddar Capital managed $1.4 billion in assets and had offices in Houston, Palm Springs and London and failed to disclose extravagant spending, such as the leasing of private jets and the purchase of sports tickets and jewelry, according to a report in the Washington Business Journal.
The DOJ complaint, says the Business Journal, alleges that Hitt raised over $16 million from investors by misrepresenting that he would invest $6 million in a planned $33 million purchase of a Herndon building near a future Metro stop.
The Business Journal also reports that in a complaint filed in the U.S. District Court for the Eastern District of Virginia, the SEC alleges that Hitt made misrepresentations about his own investments and misappropriated several million dollars of investor funds to support what the agency described as his extravagant lifestyle and make “Ponzi-like payments to prior investors.”
Regarding the Herndon project, the Business Journal says an affidavit details how Hitt told investors he would contribute $6 million to the project but, instead, did not contribute any money. The affidavit alleges Hitt raised almost $11 million from investors, even though he only needed $8.85 million. When the deal closed, Hitt diverted the additional funds to other projects and expenses without notifying investors, the affidavit says.
The affidavit also alleges Hitt used $230,000 is funds to pay off a credit card bill with charges from “Bulgari,” “Catier,” “NBA – Washington Wizards” and “Ultimate Jet Vacations.”
Hitt’s Kiddar Capital played a pivotal role in the opening of the WestBroad project that houses the flagship Harris Teeter store which opened in Falls Church in 2016.
