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Longtime Californian restaurateur sentenced for role in $350M Ponzi scheme

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Posted at 6:27 AM, Apr 01, 2021
and last updated 2021-04-01 09:27:25-04

SAN DIEGO (KGTV) — Longtime San Diego business leader and restaurateur Gina Champion-Cain was sentenced to 15 years in prison Wednesday for her role in a years-long Ponzi scheme, among other charges.

Champion-Cain pleaded guilty on July 22, 2020, to raising more than $350 million from investors with the promise of making loans to business owners trying to get California liquor licenses, only to use that money with co-conspirators to pay back others whose investments would soon be redeemed and support her businesses that "were failing or had negative cash flow" and lifestyle expenses, according to the office of acting U.S. Attorney of the Southern District of California Randy Grossman.

Grossman's office says those lifestyle expenses included, "her own salary, box seats at professional baseball and football games, credit card bills, automobiles, jewelry, and other personal luxuries."

Investigators added that Champion-Cain kept the scheme going by, "fabricating documents, forging signatures, and telling investors lies through fake email accounts so that when investors attempted to double-check on their investments with third parties, they were often really communicating with the defendant or her employees."

Grossman's office says as part of her plea agreement, Champion-Cain also admitted to obstructing justice by hiding and destroying evidence from federal investigators:

"Beginning in July 2019, after learning of investigations being conducted by federal agencies, she instructed her employees to destroy emails; not produce electronic calendar, messaging, and trash files; alter accounting records to hide the fact that investor funds were used to pay her personal expenses; and shred paper records. Champion-Cain even attempted to solicit an investment of $150 million in the hopes that she could use the funds to hide her scheme. Despite her efforts, investigators were able to recover a significant volume of the evidence Champion-Cain attempted to destroy."

U.S. District Judge Larry Alan Burns told Champion-Cain the "monumental crime" showed "tremendous callousness" and "extreme avarice" during her sentencing.

"This is a fitting sentence for a defendant who caused significant harm to hundreds of victims," said Grossman. "This Ponzi scheme cost investors hundreds of millions of dollars while the defendant lived in luxury. We will continue our aggressive efforts to prosecute those who swindle, deceive and bring financial devastation to victims."

Crispin Torres, the former Chief Financial Officer of one of Champion-Cain’s companies, was sentenced on March 23 to four years in prison for using funds received from investors to prop up Champion-Cain’s other businesses.

This story originally reported by Mark Saunders on 10News.com.