Keenan Alexander Gracey presented a lavish lifestyle of expensive cars, luxury mansions, and a multibillion-dollar family fortune in Britain to entice more than $3 million from investors in Washington and California. But it was all an elaborate charade, federal prosecutors allege.

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Tall, athletic and confident, with the cultured tones of a British aristocrat, Keenan Alexander Gracey carried all the signs of someone who knew how to make money.

He swanned around Seattle and Los Angeles in Bentleys, Ferraris and Lamborghinis. He hosted gatherings at multimillion-dollar mansions, one in the tony Clyde Hill community overlooking Lake Washington and another, in Beverly Hills, that had previously been owned by Wheel of Fortune star Vanna White.

Claiming a long pedigree of wealth and privilege — his great grandfather, he said, had co-founded General Dynamics and Lloyd’s of London — Gracey talked about how he’d used family connections to build a hugely successful investment business, with access to some of the biggest deals in the corporate world.

One such deal, he explained, involved the merger of three technology companies into a new firm whose shares Gracey had gained access to under a “pre-IPO” discount — one he could share with certain close friends and acquaintances.

“I care about you,” Gracey wrote to one of many companions-turned-investors he met in the Seattle area and Southern California. “So if you’re interested in me getting you in I’ll add you to my end of the investment.”

The only problem, according to federal prosecutors and the Securities and Exchange Commission, was that none of what Gracey was selling, or telling, was real.

On Dec. 20, the 27-year-old Newcastle resident was arrested outside a Los Angeles County courthouse by five agents of the Federal Bureau of Investigation. He’s charged with defrauding at least 25 investors of more than $3 million starting in mid-2016.

Investigators say nearly everything about Gracey had been an elaborately staged fraud.

Gracey, it turned out, was Canadian, not British, according to the U.S. Attorney’s Office in Seattle, where Gracey will shortly face federal charges after he is transported from Los Angeles by U.S. Marshals.

And his life of luxury was largely made up, according to the charges.

Gracey’s luxury cars were leased.

His mansions were mere rentals, in one case booked online at a rate of $7,500 a day.

The “pre-IPO stock” Gracey sold his victims never belonged to him and, possibly, never existed.

Much of the $3 million-plus Gracey allegedly took from investors may have been spent to sustain the lifestyle that seems to have both motivated the purported crime and also helped carry it off.

“We’re seeing white-collar criminals use new and innovative tricks such as ultra-high-end Airbnb rentals, to create the illusion of wealth and pull off the age-old Ponzi scheme,” said Seth Wilkinson, the Assistant U.S. Attorney in Seattle who is overseeing the case, in a statement Friday. “It should be a reminder to investors that things are not always as they appear.”

Gracey’s alleged scheme began as early as June 2016, according to officials with the SEC and the U.S. Department of Justice, and continued through last May, when at least one of Gracey’s alleged victims discovered some of Gracey’s fabrications and filed a complaint with the SEC.

Subsequent investigations by the SEC and the FBI revealed an “an elaborate scheme to cause investors to part with their money,” according to the SEC complaint.

The scheme, carried out by Gracey and possibly others, involved Gracey in the role of a billionaire British heir.

Gracey told investors his great-grandfather was “the lord commander of the British Empire” and a co-founder of General Dynamics and Lloyd’s, according to the federal complaints.

Gracey also claimed to have graduated from both the London School of Economics and Oxford University, after which he had become a successful businessman in his own right “with hundreds of millions of dollars in investments.”

To add weight to these claims, investigators charge, Gracey spent tens of thousands of dollars concocting a high-end lifestyle.

He rented high-end cars — often at rates of as much as $1,800 a day, according to the complaint.

Gracey also set himself up in style. He leased a luxurious Clyde Hill home a few minutes’ walk from Lake Washington that rented for $13,500 a month.

More impressive still was the 14,554-square-foot home Gracey leased on Beverly Park Lane in Beverly Hills. The eight-bedroom, 10-bath mansion features an on-site vineyard and rents today for $150,000 a month, according to homesoftherich.net. Redfin lists a sale price of $47.5 million.

Gracey created a convincing financial narrative using three actual companies — DXC Technology, Keypoint Government Solutions and Vencore —that were in fact planning to merge into a new firm, Perspecta.

His embellishment was that Perspecta intended to sell stock publicly and that Gracey himself had privileged access to special “pre-IPO” shares, according to the complaint.

Gracey told his victims he could get them these shares for the massively discounted price of $1 a share — and that the price was all but guaranteed to jump to $60 per share after the IPO, according to the complaint.

We’re seeing white-collar criminals use new and innovative tricks such as ultra-high-end Airbnb rentals, to create the illusion of wealth and pull off the age-old Ponzi scheme.” - Seth Wilkinson, the Assistant U.S. Attorney in Seattle

Exactly how Gracey found his alleged victims isn’t fully specified in the federal complaints. What is clear is that they ran the gamut of income and investment experience.

In fact, while many of Gracey’s alleged victims were not wealthy or sophisticated investors, according to Wilkinson, some appear to have been quite well off.

One person invested $575,000 with Gracey between Dec. 30, 2017, and May 15, 2018. Another raised $745,000 from family and friends, and wired it to Gracey between January and March.

Victims had little in common, other than knowing Gracey or knowing someone who knew him.

But many victims “generally related highly similar experiences with Gracey,” according to the complaint. Gracey presented his bogus family history, made a show of wealth with his expensive cars and invited them to his mansions. In one case, he sent a prospective victim videos “of my family’s estate here so you can understand the surrounding of the area and how most of my neighbors are billionaires.”

He presented them with falsified bank statements “purporting to show that Gracey had immediate access to over $700 million,” according to the SEC complaint.

Then he laid out the story about Perspecta and the “pre-IPO” shares, and invited them to take a stake.

He also “offered a range of incentives for investors to bring in other investors,” including an offer of 10 percent of the profits earned from these referrals, the SEC charges.

There had been signs that Gracey was running a con years earlier.

According to the federal complaint, Gracey’s 2014 marriage fell apart after only a year when his then-wife discovered that Gracey had lied about being a professional athlete from Britain who was “involved in stocks” and had a “trust fund.”

But his tales had at least an element of truth.

A profile on the website of the Canadian national soccer team lists a Keenan Gracey as having debuted with the Canadian youth program in 2009 at the age of 18. According to the profile, Gracey spent several years as a child in England before moving back to Canada.

Federal officials describe him as standing 6 foot 9 inches, and weighing between 285 and 300 pounds.

In the spring of 2018, Gracey’s credibility began to crumble after the date he had given for Perspecta’s IPO came and went with no actual IPO, according to the federal complaint.

Investors grew suspicious. In March 2018, a group of investors from Washington state flew to Los Angeles and “confronted Gracey at his (rented) Beverly Hills estate,” according to the SEC. Gracey “agreed to refund $50,000 within a week,” according to the complaint, but “neither refunded investors’ monies nor provided further details about the investment.”

Instead, according to the SEC, Gracey continued to seek new investors.

Also in March, Gracey’s landlord for the Clyde  Hill house began eviction proceedings for nonpayment of the $13,500 monthly rent.

Soon after, the SEC referred the case to the FBI, which conducted its own investigation. On Nov. 8, 2018, the U.S. attorney in Seattle filed a formal complaint against Gracey and a warrant was issued for his arrest.

After determining that Gracey was in Los Angeles, federal agents arrested him as he emerged from the Los Angeles County courthouse where he had been dealing with another, unrelated charge.

The U.S. Attorney’s Office in Seattle expects that Gracey’s trial date will likely be set early in the new year.

Correction: Gracey’s mansion was located in Clyde Hill, not Clyde Park as referred to in an earlier version of this story. Also, the merger of technology companies created a company called Perspecta, not Prospecta as stated earlier.