Golden Valley Woman Pleads Guilty to Defrauding Investors Out of $1.1 Million

MINNEAPOLIS—Earlier today in federal court in St. Paul, a Golden Valley investment adviser pleaded guilty to defrauding investors out of $1.1 million. Renee Marie Brown, age 48, pleaded guilty to one count of wire fraud. Brown, who was indicted on May 11, 2011, entered her plea before United States District Court Judge Susan Richard Nelson.

In her plea agreement, Brown admitted that on July 1, 2009, Brown created Investors Income Fund X, LLC, a limited liability company located in South Dakota. Then, starting in June of 2009, she contacted investors by telephone, e-mail and in person, and encouraged them to invest in Fund X. Brown also admitted that she falsely told them that Fund X was a “bond fund” with an 8 or 9 percent rate of return, and that she had invested $200,000 of her own money in it. In truth, however, Fund X was not a bond fund, and Brown had never invested any of her own money in it. Brown admittedly obtained $1.1 million from investors through this scam.

For her crime, Brown faces a potential maximum penalty of 20 years in prison. Judge Nelson will determine her sentence at a future hearing. This case is the result of an investigation by the Federal Bureau of Investigation, with assistance from the U.S. Securities and Exchange Commission. It is being prosecuted by Assistant U.S. Attorneys Kimberly A. Svendsen and Kimberly M. Hare.