A former investment adviser from Golden Valley was sentenced Thursday in St. Paul to 4¼ years in federal prison for tapping $1.1 million of her clients' money to pay for a luxury condominium, private school tuition and credit card payments.
Renee Marie Brown, 48, admitted that she solicited investors in 2009 for a South Dakota company called Investors Income Fund X, which she falsely said was a "bond fund" with an 8 or 9 percent rate of return. She also lied that she invested $200,000 of her own money.
Paul Engh, Brown's attorney, sought a sentence of three years or less, arguing that his client made a serious mistake but has since worked diligently to repay her clients. Two of her former clients asked that she receive zero to very little time behind bars, Engh said, "which is unheard of in white-collar cases."
Brown said she realizes that she had shattered her clients' trust.
"I am so deeply sorry for the trauma caused them," she said. "Nobody forced me to make the decision I made. I am not asking for sympathy; there isn't any due."
Assistant U.S. Attorney Kimberly Svendsen didn't offer any. She asked for a sentence of between six and eight years. Svendsen said the reason Brown's clients were repaid was due in part to Brown's two former partners in Wildwood Wealth Management, who put up hundreds of thousands of dollars from their personal assets.
"Their business no longer exists as it once did. The sale of the business fell through," Svendsen said.
U.S. District Judge Susan Richard Nelson said Brown lied repeatedly, forged documents and disregarded another judge's orders. There's no question that she breached the trust of her investors and her partners, Nelson said. "Then you rationalized it."
Nelson said she was concerned that Brown hadn't acknowledged what she had done wrong. But she called Brown's statement in court Thursday a huge step forward.
Nelson sentenced Brown at the lower end of the 51-to-63 month range recommended by the sentencing guidelines. Nelson said she didn't want to impose a prison term that was out of line with comparable cases. She ordered Brown to serve three years on supervised release after prison, and ordered her to pay just under $600,000 in restitution, penalties and legal fees.
"I think you have a positive future ahead of you, but the first step is recognizing what you've done," Nelson said.
Dan Browning • 612-673-4493