Did you hear about the concert promoter who scammed almost $1 million from victims who were told that they were putting their money into Christian rock concerts? No? Well, it's not quite Playground Festival, but Lauren Baumann, 43, the owner and operator of a Downey firm Stewardship Estates, LLC, has pleaded guilty to wire fraud.
According to the US Attorney's Office, early this week Baumann admitted in court that she solicited loans from investors with claims that the money would be used to finance "battle of the bands" events featuring Christian rock bands and other music groups that would generate profits from ticket sales and company sponsorships. In some cases, Baumann told investors that the funds would also be used to purchase, refurbish, and resell homes.
Baumann used a big chunk of the investors' funds to pay earlier investors, who thought they were receiving profits from Baumann's venture. Of course, it wasn't all used for the Ponzi scheme; Baumann also used investor funds to pay approximately $10,000 a month to rent a historic mansion in Downey and to pay private school tuition for her children, among other personal expenses.
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As a result of Baumann's scheme, more than two dozen victims in Orange and Los Angeles counties suffered losses totaling nearly $560,000.
When she pleaded guilty, Baumann also admitted that she failed to disclose to investors that she had been convicted of securities fraud in 1999 in a Texas federal court and that she had been found liable in a related civil fraud action brought by the United States Securities and Exchange Commission.
The charge of wire fraud carries a statutory maximum penalty of 20 years in federal prison. Following the entry of Baumann's guilty plea late Monday afternoon, Judge Tucker scheduled a sentencing hearing for December 12.
The criminal case against Baumann is the result of an investigation by the Federal Bureau of Investigation.