Rey E. Grabato II, whose father Rey P. Grabato serves as mayor of Mina in Iloilo province, now appears on the FBI's Most Wanted Fraudsters list following charges related to a massive investment swindle that defrauded roughly 2,000 people of more than US$650 million. The case represents one of the most significant securities fraud investigations to involve someone with Philippine political connections, and underscores growing concerns about international fraud networks exploiting vulnerable investors across multiple jurisdictions. American authorities have pledged a reward of up to US$150,000 for credible leads that result in Grabato's capture and conviction.
Grabato's family holds considerable influence within the Iloilo municipality, where his father currently serves as mayor while his mother, Lydia Encarnacion Grabato, previously held the same position. This political prominence within their local community stands in sharp contrast to the allegations that Grabato operated a sophisticated and geographically dispersed fraud operation from positions in both the United States and the Philippines. The case illustrates how individuals with family connections to Philippine governance structures have sometimes leveraged their networks and resources to perpetrate crimes affecting thousands of ordinary people seeking legitimate investment opportunities.
As former president and majority shareholder of National Realty Investment Advisors LLC, or NRIA, Grabato allegedly orchestrated an elaborate scheme designed to deceive investors into placing funds into the NRIA Partners Portfolio Fund I LLC, a purported real estate investment vehicle. Between February 2018 and January 2022, federal prosecutors allege he and co-conspirator Thomas Nicholas Salzano employed an aggressive promotional strategy that blanketed potential victims across the United States with solicitations. The marketing campaign included thousands of emails along with television, radio, and billboard advertisements, supplemented by in-person investor presentations conducted throughout the country.
What prosecutors describe as a classic Ponzi scheme at its core relied on misrepresentation to sustain investor confidence. Promotional materials allegedly conveyed the impression that NRIA operated as a financially robust enterprise capable of generating substantial returns. Investors were told they could expect reliable profits from the fund's real estate holdings and operations. In reality, the company generated minimal revenue and instead depended entirely on capital flowing in from newly recruited investors to pay returns to earlier participants, the hallmark characteristic of unsustainable pyramid schemes that inevitably collapse.
Hundreds of the affected investors resided in New Jersey, making that state the primary focal point for federal prosecution efforts. The breadth of the victimization extended nationwide, suggesting a deliberate strategy to cast a wide net across American financial markets. Prosecutors additionally contend that Grabato and his associates misappropriated millions of dollars directly from the investor pool, diverting funds for purposes beyond legitimate fund operations. This layered fraud—combining investment deception with outright embezzlement—demonstrates the calculated nature of the alleged criminal enterprise.
Beyond the primary investment fraud allegations, Grabato faces separate charges involving obstruction of taxation efforts. Federal authorities allege he participated in a scheme running from November 2007 through August 2022 aimed at impeding the Internal Revenue Service's attempts to collect approximately US$26 million in unpaid tax obligations owed by entities within his control. These tax obstruction allegations suggest a pattern of systematic evasion spanning more than a decade, revealing potential connections between the investment fraud operation and longer-standing efforts to avoid government financial accountability.
A federal arrest warrant was issued on October 12, 2022, after the US District Court for the District of New Jersey in Newark filed charges against Grabato. At that juncture, investigators identified him as residing in Hoboken, New Jersey, and maintaining connections to the Philippines. While his alleged co-conspirator Salzano was apprehended that same month, Grabato evaded capture and fled, his whereabouts remaining unknown to authorities. The extended period at large suggests possible assistance from individuals sympathetic to his cause or simply access to resources enabling effective concealment.
The FBI recognizes that Grabato has operated under multiple aliases including Rey Encarnacion Grabato II, Rey Grabato II, and Rey Li Encarnacion Grabato, complicating international law enforcement efforts to locate and identify him. This practice of assuming different identities represents a sophisticated technique employed by fugitives attempting to obscure their movements across borders and financial systems. The multiplicity of names available to authorities highlights how international fugitives can exploit variations in documentation and record-keeping across jurisdictions.
Grabato's inclusion on the FBI's Most Wanted Fraudsters list places him among other individuals with significant Philippine connections engaged in major fraud schemes. Michael Lizaso Marasigan, a person holding dual Filipino and American citizenship with ties to both Guam and the Philippines, also appears on the roster following his May 2025 conviction on charges encompassing illegal gambling operations, money laundering, and wire fraud. Additionally, John Michael Dimitrion and his spouse Julieanne Baldueza Dimitrion, who pleaded guilty in 2009 to orchestrating a mortgage fraud scheme in Hawaii, remain fugitives after failing to appear for sentencing in July 2010. The presence of multiple individuals with Philippine connections suggests distinctive patterns in international fraud networks and transnational financial crimes affecting both American and Southeast Asian communities.
The FBI formally established its Most Wanted Fraudsters list in June as an institutional response to elevated concerns about locating high-profile fraud fugitives who have evaded conventional law enforcement detection. This specialized designation represents an escalation in investigative prioritization and reflects recognition that certain complex, large-scale fraud operations demand sustained international attention. For Malaysian and broader Southeast Asian readers, the case serves as cautionary evidence regarding investment schemes marketed internationally, particularly those leveraging telecommunications and digital marketing to reach potential victims across multiple countries simultaneously.
Investigators encourage anyone possessing information concerning Grabato's whereabouts or activities to contact their nearest FBI field office or the closest American embassy or consulate. Given his alleged ties to both the United States and the Philippines, and the possibility he may attempt to exploit connections across Southeast Asia, regional cooperation remains essential. The substantial reward amount reflects the seriousness with which American authorities regard this case and their commitment to holding even politically connected individuals accountable for defrauding thousands of ordinary people seeking legitimate investment opportunities.
