Beverly Hills Woman Arrested on Federal Charges of Running Ponzi Scheme That Collected Almost $11 Million
|U.S. Attorney’s Office December 03, 2010|
Federal authorities have arrested a Beverly Hills woman on federal wire fraud charges for allegedly running a Ponzi scheme that collected nearly $11 million from scores of Southland victims who were promised huge profits from settlement annuities.
Rosi Ray, 56, of Beverly Hills, was arrested at her business yesterday by special agents with the Federal Bureau of Investigation. Ray, who also used the names “Rose Ray” and “Gloria Lujan,” was arraigned late Thursday in United States District Court in Los Angeles, where she pled not guilty to the five counts in the indictment.
The indictment, which was returned by a federal grand jury on December 1, alleges that Ray and others solicited investments from victims who were told their money would be used to purchase court-ordered, monetary settlement annuities from accident victims at a discount, and the settlement annuities would then be cashed in at a substantial profit. Ray told investors that once she purchased the annuities she could arrange to receive the true value of the settlement in a lump sum. As part of the scheme, Ray told victims that their investments were guaranteed to earn a substantial monthly return, anywhere from 10 to 200 percent over a period of two to 12 months.
The indictment alleges that Ray did not spend any of the investors’ money on the promised investments. Rather, Ray spent the money on investor payouts, her son’s drag racing career, her purse consignment business, and personal expenses.
As a result of the fraud scheme, the indictment alleges, Ray caused approximately 180 investors to invest approximately $10.9 million in the bogus monetary settlement annuity business, with approximately half of the investors losing most of their money.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.
Each count of wire fraud in the indictment carries a statutory maximum penalty of 20 years in federal prison.
Ray was released late Thursday on a $100,000 bond. She is currently scheduled to go on trial on January 25 in United States District Court in Santa Ana.
The case against Ray is the result of an investigation by the Federal Bureau of Investigation.