A Park City businessman told roughly 100 investors he would use their money to build a brewery in Park City, and then another in California.
Instead, he pocketed the money and used it to pay off personal debts, fund vacations and pay for strippers and swingers’ clubs, according to the Department of Justice.
Timothy Nemeckay, 64, pleaded guilty to one count of wire fraud in September 2023 and admitted to “misappropriating” $1.7 million — roughly 60% of the investors’ funds. He will pay for the crime with a year and a day in prison, plus $1.7 million in restitution and $308,893 in forfeiture proceeds from the sale of his Park City home, the Department of Justice announced Thursday.
Mine Shaft Brewing was supposed to be a “ski-out” brewery and restaurant in Park City, according to court documents. Nemeckay started funding the proposed project in 2013 and later told investors he planned to build a second brewery in Santa Clarita, California.
But Nemeckay was not legally allowed to raise securities — aka solicit investments. According to court documents, he had just gotten away with helping a former business partner defraud investors in an energy drink company scheme. Nemeckay and Randy Olshen raised around $7 million, of which Nemeckay kept $300,000.
Olshen confessed to lying to investors about how much money the company was making. Olshen was sentenced to five years in prison.
Nemeckay was never charged, according to court documents. He was, however, ordered by the Utah Securities Division to relinquish his $300,000 profits and never sell securities in Utah again. The SEC also barred him from soliciting investments anywhere in the United States. The broader sanction was overturned, but not before Nemeckay had already raised and misused millions of dollars from investors for a brewery that never happened, according to court documents.
Some of the investors’ money was used to pay off the $300,000 sanction, according to court documents. Some paid for Nemeckay’s mortgage on his Park City home.
Nemeckay also used investor funds to pay for “luxury items at Louis Vuitton and Christian Louboutin, concert tickets, swingers clubs, strip clubs, and vacations to Hawaii and Cancun, Mexico,” according to a news release from the Department of Justice.
In a sworn statement, Nemeckay confessed that he “obtained money by means of materially false and fraudulent representations and promises, and omissions of material facts.” He pleaded guilty to one of the five charges for which he was indicted — one count of wire fraud. The remaining counts will be dismissed, according to the plea agreement.
Shannon Sollitt is a Report for America corps member covering business accountability and sustainability for The Salt Lake Tribune. Your donation to match our RFA grant helps keep her writing stories like this one; please consider making a tax-deductible gift of any amount today by clicking here.