Silicon Valley man sentenced in gambling fraud case

A Santa Clara County man was sentenced Monday to five years in county jail after embezzling hundreds of thousands of dollars from his friends and gambling it away in Las Vegas, prosecutors said. A Santa Clara County man was sentenced Monday to five years in county jail after embezzling hundreds of thousands of dollars from his friends and gambling it away in Las Vegas, prosecutors said. Photo: James Steidl / James Steidl / ST Photo: James Steidl / James Steidl / ST Image 1 of / 28 Caption Close Silicon Valley man sentenced in gambling fraud case 1 / 28 Back to Gallery

A Santa Clara County man who pleaded no contest to embezzling more than $400,000 from his former high school classmates and gambling the money away in Las Vegas, Monte Carlo and Dubai was sentenced Monday to five years in county jail, prosecutors said.

In 2012, Narsimha Raju Sagiraju, 28, persuaded a small group of his former classmates at Cupertino High School to invest in his startup commercial construction firm, Genwi, according to the Santa Clara County district attorney’s office.

He also persuaded his former classmates to allow him to invest their money in shares of Pinterest and Facebook, saying he could get them stakes in the companies before they were publicly available, prosecutors said.

Instead of investing the money or using the funds for his business venture, Sagiraju allegedly spent about $424,000 on himself during “lavish blackjack trips to Las Vegas casinos,” prosecutors said.

After one of Sagiraju’s victims reported the fraud to the district attorney’s office in November 2014, prosecutors opened an investigation.

Sagiraju was arrested in Las Vegas during Super Bowl weekend in early February 2016, prosecutors said. Following his arrest, another business partner told prosecutors that Sagiraju had embezzled nearly $2 million.

Sagiraju pleaded no contest to three felony counts of securities fraud and three felony counts of grand theft, prosecutors said. A no contest plea means he did not admit guilt.

A judge will decide at a Sept. 18 hearing how to make Sagiraju pay restitution to his victims.

Michael Bodley is a San Francisco Chronicle staff writer. Email: mbodley@sfchronicle.com Twitter: @michael_bodley