One good federal prosecution of an Irvine swindler . . .
. . . deserves another: United States District Judge Andrew J. Guilford in Santa Ana has sentenced Jeanne Rowzee, 53, of Irvine, to 87 months in federal prison and to pay more than $25 million in restitution.
Her crime: participating in a fraud scheme that took in more than $25 million with bogus promises of huge returns on short-term loans to businesses.
Rowzee, who was ordered to begin serving her sentence on June 15, pleaded guilty in October 2008 to conspiracy and securities fraud, admitting that she helped bilk victims who thought they were investing in public investments in private entities (PIPEs) and money market programs. When the scheme collapsed, around 140 investors suffered more than $20 million in losses.
Rowzee and James Halstead, 65, of Tustin, had promised investors returns of 25 percent to 35 percent every three to four months, claiming they had never lost money through PIPEs investments. Rowzee also boasted she was an experienced securities attorney who had previously worked for the Securities and Exchange Commission (SEC).
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But the money was never invested. Halstead and Rowzee instead used it to make Ponzi payments to some investors and to support their lavish lifestyles. Halstead, who was previously sentenced to 10 years in federal prison, bought a Ferrari, a Porsche and a Las Vegas area home with his ill-gotten take.
It all came crashing down when victims reported the fraud to the FBI's Orange County office. The SEC helped the FBI with the investigation, according to a statement from the bureau.
"Investment scams harm investors large and small, and Ms. Rowzee and her cohorts bilked scores of investors with empty promises," says U.S. Attorney André Birotte Jr. in a statement from his LA office (and doing doube-duty considering his earlier take in the Nickles case). "Rowzee played a key role in this scheme by promising huge returns on investments and pretending to be an experienced securities attorney."