Now, federal investigators say Eyewitness News' reporting shows that Webb is not telling the feds what happened to all the money.
Federal lawyers are using our report to try and convince a judge to send Webb to prison if he doesn't disclose things we discovered when we staked him out in South Florida.
The Securities and Exchange Commission says Webb took millions of dollars from investors through an "illegal real estate investment fraud scheme" where it says Webb told investors that he'd rehab run-down houses and split the profit. Instead, the SEC says he used the money to live a luxurious lifestyle.
Now, after seeing Eyewitness News' report, the SEC is taking action.
When we found James Webb in a gated community in Florida, he got out of a brand-new BMW M6. That's a $100,000 car.
Newly filed federal court documents say Webb didn't even tell investigators about that BMW or the Audi A4 and Infinity M35 in his driveway.
"It's not about the cars, okay," said James Webb in July.
The day after our story ran, the SEC says Webb told investigators he only had "nominal assets," "no real estate," and only $2,500 worth of household goods, furniture and jewelry.
In the motions, the SEC says Webb offers no "explanation whatsoever" about how he affords to live his "lifestyle."
- Steve Daniels: "Well you understand that there are people who want to know what happened to their money."
James Webb: "And, I know exactly what happened to this business, who destroyed my business."
The SEC also says that Webb is still at it.
Court filings say Webb continues to "defraud additional victims" through a new company called First Tier Rehabilitation and Training. They say that since they told Webb to stop operating his business, he's made at least $133,000 from people that bought into his same old scheme under a new name.
SEC lawyers want a judge to throw Webb in prison until he explains where he's getting the money to support his lifestyle and until he pays the courts the $133,000 they say he's recently taken from these new investors.
Eyewitness News will continue to follow this case and bring you updates as they become available.
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