UPDATED 10:41 AM PT — Thursday, July 23, 2020
A San Diego businesswoman recently confessed to one of the biggest Ponzi schemes ever recorded in the region. On Wednesday, Gina Champion-Cain pleaded guilty to three felony charges of conspiracy, securities fraud and obstruction of justice.
“Champion-Cain admitted under oath in court that she was the mastermind of a massive, $400 million Ponzi scheme involving hundreds of victims in California and across the nation,” stated Robert Brewer, a U.S. attorney for California’s Southern District.
#FBI #News Gina Champion-Cain pled guilty in federal court today, admitting that she committed securities #fraud by masterminding a massive, years-long Ponzi scheme with hundreds of victims throughout California and the U.S. https://t.co/OIiOrr91xr @SDCAnews @SEC_Enforcement pic.twitter.com/zb7IIOaUfP
— FBI San Diego (@FBISanDiego) July 22, 2020
Champion-Cain was charged in august of 2019 after the Securities and Exchange Commission complained of her actions. From 2012 to 2019, the businesswoman perpetuated a Ponzi scheme that robbed many investors of their retirement funds and forced at least one into bankruptcy.
“The financial condition of scores of investors will never be fully restored because of the selfish and illegal acts of this defendant,” Brewer continued.
Champion-Cain was able to manipulate investors by telling them their money would be placed in an escrow account to create loans for applicants attempting to obtain liquor licenses. She told the investors that once the license was obtained, the applicants would pay the loan back to the investors and both the investors as well as Champion-Cain would receive interest payments on the loans.
However, Champion-Cain did not inform the investors that she had access to the escrow account. She used the money to pay previous investors to continue the conspiracy to aid her personal businesses and restaurants. She also used it to fund her own salary to maintain her “luxurious lifestyle.”
Champion-Cain tried to cover up the crime by deleting numerous emails and destroying evidence. The defendant’s co-conspirator, Crispin Torres, also pleaded guilty Wednesday to conspiracy.
Champion-Cain is expected to be sentenced on October 13 with a maximum potential sentence of 15-years in prison. She will have to pay restitution up to $160 million.