April 25, 2014
According to an Information filed on November 14, 2013, in USA v. Kimberly D. Fontenot, the defendant owned and controlled Stellar Grants, Inc, which Fontenot claimed was a business that would introduce wealthy investors to clients seeking capital. Her proposition was fairly simple: pay her a commission and she would match you with a wealthy lender.
Of course, there was a catch.
C'mon, now -- what did you expect? This is, after all, the BrokeAndBroker Blog, where we revel in disclosing all sorts of investment nonsense, scams, and shenanigans.
Smoke, Mirrors, and Email
Seems that the industrious Ms. Fontenot created Yahoo.com and Gmail.com email accounts in the names of purportedly wealthy investors. That's "purportedly" as in the much shorter word "fake," or if you prefer, the much longer "nonexistent." Through these bogus email accounts, Fontenot was able to give the appearance that "angel investors" were communicating directly with clients introduced through Stellar Grants.
Another nice touch - a truly clever bit of foolery - was that Fontenot set up a number of bogus telephone conference calls. At these sham gabfests, Fontenot played the role of the representative of one of her clients. On the other side of the line was an angel investor. In reality, that other party, however, was a hired actor, who pretended to be either the big bucks investor or a representative of same. Fontenot went so far as to prepare a script for the actor to read to reference during the calls.
Lenny, listen honey, you're just reading the lines, walking through the scene, so to speak. I need to feel it. You understand what I'm saying here? You need to convince me - ya gotta sell the part, sweetheart. So -- let's try it again from the top. I got this rube on the line with me and you're the big shot with a few million bucks floating around. Convince me that you're willing to lend a few hundred thou to my pigeon. Okay, from the top. And with feeling.
Oh, and another nice touch, Fontenot drafted an impressive looking Master Consulting Agreement that her clients had to sign. Embedded in this agreement was a hefty financial penalty if any client had the audacity to directly contact one of the angel investors.
On December 5, 2013, Fontenot pled guilty to one count of wire fraud and faces a maximum penalty of 20 years in federal prison and a $250,000 maximum fine or twice the pecuniary gain or loss.
On April 24, 2014, Fontenot was sentenced to of 37 months in prison, three years of supervised release, and ordered to pay $115,115 in restitution.
Read these recent wire fraud articles: