A Lawrenceville man and Roswell woman who raised $29 million from unsuspecting investors and promised 15 percent returns were sent to prison Tuesday for fraud, according to the U.S. Attorney’s Office in Atlanta.
Geoffrey A. Gish, 57, of Lawrenceville was sentenced to 20 years, and Myra J. Ettenborough, 56, of Roswell was sentenced to seven years for their roles in the scheme, which included mailing to investors statements showing bogus high yields.
In what prosecutors described as a classic Ponzi scheme, the pair also paid off some investors with funds raised by other investors to keep the ruse going.
“These defendants tricked investors into handing over millions of dollars with promises of high yield trading programs that supposedly offered safety, security and extraordinarily high returns,” U.S. Attorney Sally Quillian Yates said in a statement Tuesday. “These well-known schemes are all too common, and investors should be skeptical of offers that sound too good to be true.”
Investors were assured their millions were safe in three pooled funds managed by Gish’s investment firm, Weston Rutledge Financial Services Inc.
Those funds included Zamindari Capital LLC, Lexington International Fund Inc., and Oxford Adams LLC.
Gish operated, controlled, and was the primary salesperson for Weston Rutledge, and Ettenborough was his office manager, who also managed his bank accounts, including those established to receive and disburse investment funds, federal authorities said in an August 2010 indictment.
“Of the $29 million that had been raised from investors, Gish and Ettenborough had used $11 million to pay investors who requested withdrawals or payment of the supposed earnings that their investments were making,” the U.S. Attorney’s Office said in a statement. “The remaining $18 million was gone, used for a variety of purposes that were inconsistent with the promises that Gish and Ettenborough had made to investors.”
Gish lied to investors about how their money would be used and the returns that would follow, prosecutors said. He said funds invested in Zamindari Capital, for example, would produce gains of 10 percent to 15 percent a month. He said money invested in the Lexington Fund would produce gains of 4 to 8 percent a month.
Neither fund, however, received “significant and meaningful funds, earnings, and gains,” prosecutors said.
Gish and Ettenborough were using some of the proceeds for personal use, including a house and multiple vehicles for Gish, prosecutors said.
The Ponzi scheme extended from 2004 until 2006. Gish, whom the state had accused of acting as an unregistered investment adviser in the past, and Ettenborough continued their fraud even after being told on several occasions that their practices were fraudulent.
Their scheme came to light after the U.S. Securities and Exchange Commission requested that Weston Rutledge and the three pooled investment funds be placed into receivership.
Both Gish and Ettenborough were convicted of the charges Sept. 23.
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