Home Richmond Press Releases 2010 Birgit Mechlenburg Pleads Guilty on Eve of Jury Trial

Birgit Mechlenburg Pleads Guilty on Eve of Jury Trial
Defendant Faces Possible Five-Year Jail Term

U.S. Attorney’s Office September 10, 2010
  • Western District of Virginia (540) 857-2250

LYNCHBURG, VA—Just three days before the start of a jury trial that was expected to last two weeks, the woman charged with being part of an international Ponzi scheme pled guilty in the United States District Court for the Western District of Virginia in Lynchburg.

Brigit “Gitte” Mechlenburg, 62, a Danish citizen and former resident of Massachusetts who was extradited from Andorra early this year, pled guilty late Thursday evening to one count of conspiracy to commit wire fraud. Mechlenburg and others were indicted in April of 2007, and charged with operating a Ponzi scheme that bilked investors in the United States and Europe out of more than $100 million.

“I am pleased that this case has come to a successful conclusion and hope that Ms. Mechlenburg’s guilty plea can give a least a small amount of closure to the victims in this case.” United States Attorney Timothy J. Heaphy said today. “Ms. Mechlenburg’s plea should send a message to would-be promoters of fraudulent investments schemes that they will be held accountable for their criminal conduct.”

The investigation established that the scheme, dubbed the “Vavasseur” program, operated from 1998 through September of 2002. Mechlenburg was one of the promoters of the fraudulent “Vavasseur” scheme which promised extraordinarily high returns to investors. Mechlenburg was responsible for bringing more than $13 million of investor funds into the scheme. Co-defendant Terry Dowdell, formerly of Charlottesville, Virginia, pled guilty in 2005, and is serving a 15-year prison sentence for his role in the offense. Several other related defendants were successfully prosecuted in Charlottesville, Virginia, in 2007, and three co-defendants were convicted in the United Kingdom in a related case, in 2008.

Last week in Federal District Court, Mechlenburg admitted to her role in the conspiracy, in a guilty plea which calls for an agreed sentence of five years, the maximum penalty for the wire fraud conspiracy. Mechlenburg remains in federal custody pending her sentencing hearing, which has been scheduled for December 10, 2010, at 9:30 a.m. in the U.S. District Court in Charlottesville.

The investigation of the case was conducted by the Securities and Exchange Commission and the Federal Bureau of Investigation. Assistant United States Attorney Jean Hudson and Special Assistant United States Attorney Steven J. Levine of the Securities and Exchange Commission prosecuted the case for the United States.

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