Woman Gets 9 Years In Federal Prison For $7 Million Ponzi Scheme

Guadalupe Valencia, 47, admitted running a Ponzi scheme that took in almost $7 million from more than 150 victims.

Valencia was sentenced to nine years in federal prison on Monday October 24, 2011 after a 5-4 hearing for two counts of mail fraud, two counts of wire fraud, and two counts of tax fraud.

Valencia was also ordered to pay $5.2 million restitution.

Her scheme was ran out of the Downey offices of companies she called Real Estate & Loan Consultants and R.E. Equity Group, Inc.

Beginning in 2001 and continuing through 2009, Valencia promoted two types of investment pools, with one supposedly funding loans to purchase real estate, and a second said to be short-term loans to businesses and promised high rates of interest (8-10% in as little as 45 days).

Valencia victimized 150 victims and admitted to providing worthless promissory notes and admitted that the investment did not generate any profit.

In addition to the mail and wire fraud charges, Valencia pleaded guilty to two counts of filing false tax returns. Valencia 's scheme raised about $7 million with an actual loss amount of $5.2.

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