(CN) – A Minnesota-based investment adviser stole $1.1 million by duping investors into transferring their money into a bogus bond fund, the Securities and Exchange Commission claims in Federal Court. The agency says Renee Marie Brown occasionally distributed “Madoff-like returns” to make the fund appear legitimate, but used most of the money to buy a condo and build office space for her business.
Over a one-year period beginning in July 2009, Brown allegedly enticed investors to put their money in the Investors Income Fund X by promising returns of between 8 percent and 9 percent.
The agency claims Brown continued to siphon money after her misconduct was discovered by her former employer, Wildwood Wealth Management. Wildwood fired her on March 17.
According to the SEC, Brown turned over to Wildwood the amount she didn’t spend — $300,000 of the $1.1 million — and promised to transfer the title of the condo over to the company.
But Brown allegedly reneged on the deal, prompting Wildwood to sue in Minnesota state court. That case is pending.
The SEC seeks an order barring Brown from securities trading, disgorgement of all ill-gotten gains, and civil penalties on claims of violating the Securities, Exchange and Advisors Acts.
The agency’s attorneys are Jonathan Polish, Kent McAllister and Helen Contos.