Robin Schild was so happy with his $250,000 investment, he mortgaged his house for $400,000 and sunk that too into Ken Casey's real estate investment firms that promised sky-high returns and came with even higher praise from friends.

Since investing in 2016, the Albany resident said he regularly received his monthly 9% interest payments deposited into his bank account and at one point withdrew $200,000 from his account with no problems. So he was shocked when he received a call from a friend and fellow investor who said all investments and interest payments had been frozen and federal regulators were investigating Casey's companies for running an alleged Ponzi scheme.

"It's like, do I need this in the middle of the worst epidemic in 100 years?" Schild said in an interview with The Chronicle. "I think I'll be lucky to get half of it back ... and I consider myself lucky because other people had everything they owned invested and I've heard there are people going on food stamps."

The 63-year-old is one of more than 1,000 investors scrambling to recover hundreds of millions of dollars from the alleged Ponzi scheme involving Casey, who died in May from a heart attack. His admirers celebrated him as a Republican donor, philanthropist and adventurer who amassed an enormous portfolio of office parks and apartment buildings in Marin and Sonoma counties.

Shortly after his death at age 73, a law firm and accountant tasked with transferring his companies Professional Financial Investors Inc. and Professional Investors Security Fund Inc. to his ex-wife uncovered the allegations of fraud. They now question whether more officials from the Novato companies profited off the three decades of a "Ponzi-like operation," according to bankruptcy records reviewed by The Chronicle.

Forensic accountant Michael Hogan, who has been named chief restructuring officer for the companies, pored over the financial records and found the companies used new investor funds to pay off other investors' interest payments and other debts, according to his bankruptcy declaration.

Hogan estimates Casey's companies owned interests in about 70 real estate properties with an estimated worth of more than $550 million. However, those properties have debt exceeding $400 million and his companies owe more than $250 million to investors, he said in court records. Last month, both companies filed for bankruptcy.

"Over a period of at least three decades, Mr. Casey appears to have operated a fraudulent scheme in which investors loaned funds to the Companies, with a significant portion of those funds being used to service the debt owed to existing investors and to personally enrich Mr. Casey himself," Hogan said. "Others associated with the Companies also appear to have been involved and benefitted from the scheme, and this investigation is ongoing."

The SEC initiated its investigation on May 28, he said. An SEC spokeswoman declined to comment.

Casey started his companies in 1983, serving as the sole officer until 1998. He maintained complete control of the companies until his death, Hogan said.

He divorced his wife, Charlene Albanese, in 1996, but left her the companies. In a statement to The Chronicle, Albanese said she hired lawyer Eric Sternberger two days after Casey's death to review the corporate finances.

"Mr. Sternberger discovered a variety of improprieties, after which I directed the company to self-report to the SEC, which then began its investigation," she said. "Funds were frozen to preserve them for the investors, except those relating to bank debt and normal operating expenses, and all officers were removed.

"Company operations are stable, Chapter 11 has been filed, and I am resigning from the director position so professionals and creditors can appoint a qualified independent director," she continued. "I am heartbroken and sick to my stomach that so many investors, myself included, have been devastated by Ken's actions. Like all of the other investors, I am waiting to see what can be preserved."

Hogan also reported in his recent bankruptcy declaration that the companies' former CEO, Lewis Wallach, "may have also benefited from the manner in which Mr. Casey ran the Companies."

Last month, the law firm reached an agreement with Wallach to return $1 million from an LLC that he controlled, and is waiting for him to return two properties with several million dollars in equity, Hogan said.

Property records show Wallach owning an Encino (Los Angeles County) home with his wife purchased more than a decade ago for $3.5 million. They also indicate Wallach owned a beachfront Malibu property that is now renting for $30,000 a month.

A woman answered the phone and took a message for Wallach on Aug. 1 . He did not return the call.

At Casey's passing, Marin County officials hailed him as the largest commercial property owner in the county in an article by the Marin Independent Journal, which first broke the stories of the alleged scam. He was regaled as a philanthropist and an adventurer, who Herb Caen once wrote about in 1995 when he was training to become the 13th man to reach the North Pole by dog sled.

However, he had past legal troubles. In 1997, Casey pleaded guilty to one count of conspiracy to defraud the federal government, five counts of tax evasion and filing false tax returns, and 41 counts of bank fraud. He was sentenced to 18 months in prison, according to court records.

Casey had recently become active in donating to Republican causes, including a $300,000 donation from Casey's companies to a committee created to advocate for the repeal of the state's gas tax. He also donated to Travis Allen's and John Cox's unsuccessful runs for governor.

In October 2018, he loaned Marin County District Attorney Lori Frugoli $25,000, just 13 days before the election that she would win by a few hundred votes.

"She asked me for a loan and I said sure," Casey told the Independent Journal at the time. "I'm not supporting her to get out of any parking tickets."

Frugoli told The Chronicle on Monday that in May she repaid the loan in full "prior to any of the recently discovered information about PSIF Inc."

"Mr. Casey was a friend of my late husband and I knew of Mr. Casey through his service on the Marin County Human Rights Commission," Frugoli said in an email. "Like many others, I was shocked to learn of the allegations which have surfaced. Mr. Casey never attempted to 'curry favor' from me or my office."

As for Schild, he said he was introduced to the company by a friend and he only spoke a few times to Casey over the phone and found him friendly. He said he'd likely have to sell his Oakland condominium to pay off his debt.

"It's all dependent on getting fresh suckers," Schild said. "And there's not an infinite supply of suckers."