A pudgy Las Vegas high roller who’s facing a prison sentence on fraud charges has accused a posh heiress to the Dean Witter fortune of ratting him out to the feds — but not before, he claims in court papers, she dumped shares in his fizzled gambling company to unwitting investors.
Robert Alexander, a 51-year-old video-game promoter who blew through a $30 million windfall he’d reaped after selling his company to the makers of “Grand Theft Auto,” pleaded guilty last year to swindling shareholders in another company he started called Kizzang.
Alexander — who has a taste for craps tables, strip clubs and palling around with former NBA stars, according to the feds — is facing as many as 40 years in prison on convictions for securities and wire fraud. According to court papers, he raised some $9 million starting in 2013 to fund Kizzang and used some of the proceeds as his personal piggy bank.
That included siphoning off $400,000 to spend in casinos, where he’d arrive by Maybach, and $579,000 to pay his credit card bills. By 2017, Kizzang — which had hawked digital sweepstakes, slot tournaments and contests — was “hopelessly insolvent,” Alexander told investors.
Among the investors who got bilked: Sherry Pryor Witter, a Wharton-educated financial guru who has worked at posh Wall Street firms including Lazard and billionaire Eddie Lampert’s hedge fund ESL Investments.
Now, Pryor Witter runs the Witter Family Office with her husband Michael D. Witter, according to her Web site.
The latter is the grandson of the legendary Dean Witter, who started the eponymous Wall Street brokerage in 1924.
Now, Alexander says he would have never been caught if not for Pryor Witter. In explosive court papers, Alexander claims Pryor Witter called the FBI and blew the whistle on him when she realized she’d been scammed.
Alexander’s attorneys, however, went on to make an even more incendiary claim: Before Pryor Witter ratted out their client, they allege, she made sure to unload her shares in Kizzang, which they claim she knew were worthless. It was only then — once she’d ditched the junk shares — that she snitched to the FBI, they allege.
“If the allegations of Sherry Pryor Witter against the defendants are to be substantiated then she is a fugitive from justice for the resale of the worthless paper she sold after her criminal allegations against the defendants,” Alexander’s lawyers alleged in court papers filed in the US Southern District of New York and with the US Securities and Exchange Commission.
Pryor Witter’s spokesman told The Post she was only a victim of Alexander’s fraud. He declined to comment further.
It’s not clear how Pryor Walter, 47, came to be an investor in Kizzang. She’s listed as chief investment officer on the Web site of the Witter Family office. It’s not clear how much money the office manages. Her bio says she started her first hedge fund at 23, after graduating from the University of Pennsylvania. Her wealthy husband, who according to the family office’s Web site focuses on philanthropic work, isn’t named in the suit.
Court papers also don’t say when Pryor Witter invested in Kizzang, how much she invested or when or to whom she allegedly sold her shares.
Despite the fact he has already confessed to his crimes, Alexander may be looking to throw Pryor Witter under the bus in hopes to show he’s not the only bad actor in the situation, a source familiar with the matter told The Post. The idea is to land a lighter sentence, the source said.
So far, Alexander has avoided prison, where he could face a maximum sentence of 20 years for one count of securities fraud and one count of wire fraud to which he pleaded guilty in January 2020. Since his plea, he’s been successful in asking for delays to his sentencing — twice citing the coronavirus and once saying he’s going blind and needs surgery on Oct. 11 to fix his eyes.
Real estate investor Eric Fessler, who lost $200,000 in Kizzang, told The Post that Alexander’s claims are usually far-fetched.
“It’s the same lies I’ve been hearing for 15 years,” said Fessler, who lent Alexander money that was then rolled into Kizzang. “You can’t believe what he says. He’s not an honorable person.”
Alexander, who spent $44,809 of investor money on excursions to amusement parks, spas and “adult entertainment venues,” according to court papers, hasn’t exactly been lying low since pleading guilty to the swindle. A marketing firm he started in July 2020, called Peragos, is doing work for his pal and ex-Knick Charles Oakley, The Post has learned. Among other projects, Oakley currently peddles a line of indoor grills. Oakley didn’t return e-mails from The Post.
The Post reached Alexander on his cell phone. He wouldn’t comment and directed The Post to his attorneys. His attorneys declined to comment.