Ex-Advisor Dawn Bennett Sentenced to 20 Years in Prison
Bennett, the former "Financial Myth Busting" radio host, was convicted of defrauding retirees out of $20 million.
Dawn Bennett, the former advisor who owned a luxury sportswear company and hosted the radio show “Financial Myth Busting,” was sentenced to 20 years in prison Wednesday for defrauding retirees out of $20 million.
“Dawn Bennett knowingly defrauded retirees of their life’s savings — most of which she used for her own personal benefit,” said U.S. Attorney Robert K. Hur. “She’s been held accountable for her lies and theft and will now spend years in federal prison.”
Bennett, 56, of Chevy Chase, Maryland, faced 17 federal charges including conspiracy, securities fraud, wire fraud, bank fraud and making false statements on a loan application.
U.S. District Judge Paula Xinis ordered Bennett to pay restitution of $14.5 million and forfeiture of $14.3 million.
According to the ruling, between December 2014 and April 2017, Bennett solicited individuals to invest money in her internet clothing business, offering an annual interest rate of 15% via convertible or promissory notes.
The $20 million she secured from 46 investors, mainly retirees, was used to fund such things as a luxury suite at a football stadium; to pay a website operator to arrange for priests in India to perform religious ceremonies to ward off federal investigators; to purchase astrological gems; and for cosmetic medical procedures.
“In order to entice individuals to invest, Bennett made false and misleading statements, including: the risks of investing in DJB Holdings; how investors’ funds would be used; and that the loans were liquid and guaranteed by DJB Holdings’ inventory and assets, and by Bennett herself,” the ruling states.
Witnesses testified that Bennett concealed the true financial condition of her companies from investors.
Bennett was convicted in a federal court in Maryland last October of charges she defrauded investors out of millions of dollars.
A Financial Industry Regulatory Authority panel decided in March 2017 that Bennett must pay a client over $1 million in compensation and fees for investments in SPDR Gold ETFs.
The Miami-based FINRA panel ruled then that Bennett, Western International Securities and Bennett Group Financial Services were required to give Steven Santagati, a dating counselor, about $764,000 in compensation and nearly $280,000 to cover legal and related fees.
Bennett, now barred from the industry, racked up an extensive regulatory record over her 28-year career with five firms, according to FINRA’s BrokerCheck.
The Securities and Exchange Commission announced fraud charges against Bennett and her financial services firm in September 2015 for “grossly inflating” its assets under management on a radio talk show and on Facebook.
— Related on ThinkAdvisor: