MN Investment Adviser Hit with Fraud Charges
An investment adviser from Golden Valley was indicted on Wednesday for allegedly defrauding investors out of $750,000, according to the U.S. Attorney's office in Minnesota.
Renee Marie Brown, 47, was charged with five counts of securities fraud, five counts of wire fraud, and one count of money laundering.
The charges stem from Brown's time as an adviser for Income Fund X, LLC, which she created. She allegedly solicited investments in the fund by telling investors that Fund X would generate an 8 or 9 percent return, and that she had invested $200,000 of her own money in the fund.
The indictment states that Brown never put her own money in the fund, and she used more than $500,000 of investors' money to buy a condominium and pay off her credit cards, among other personal uses. She also allegedly paid out “returns” to investors that were actually just transfers from other investors' funds.
Brown was also sued by the U.S. Securities and Exchange Commission (SEC) last April. The indictment filed on Wednesday is very similar to the SEC's complaint. Public court records indicate that the SEC's civil suit is not yet closed but may be nearing a settlement.
Regarding the government's indictment, Brown faces up to 20 years in prison on each securities fraud and wire fraud count, as well as 10 years for the money laundering charge.