DOJ Charges NJ Woman With $45 Million Real-Estate Ponzi Scheme
By David Benoit, Of DOW JONES NEWSWIRES
NEW YORK -(Dow Jones)- The U.S. Justice Department Wednesday charged a New Jersey woman with running a $45 million Ponzi scheme, alleging she raised millions of dollars under the pretenses of investing in real estate and instead gambled much of it away at casinos.
The U.S. Attorney for the Southern District of New York alleged that Antoinette Hodgson, a 58-year-old woman from Montclair, N.J., solicited tens of millions of dollars from New York and New Jersey investors, telling them she would spend the money to purchase and renovate residential real estate and either re-sell or rent the properties.
Prosecutors said Hodgson promised investors high rates of return but, after raising about $45 million, she used the funds to repay other investors.
She also allegedly spent hundreds of thousands of dollars gambling in casinos in both Las Vegas and Atlantic City and invested more than $700,000 in a Dunkin Donuts franchise in Arizona. Tens of thousands of additional dollars were given to friends and family, the prosecutors said.
Hodgson surrendered to authorities earlier Wednesday and is scheduled to appear before a judge in Manhattan later.
"What Antoinette Hodgson allegedly promised to investors seemed too good to be true and that's because it was," U.S. Attorney Preet Bharara said in a statement. "This case is a further reminder that, whether the real estate market is up or down, innocent investors can be and will be targeted by unscrupulous fraudsters."
Hodgson is charged with one count of conspiracy to commit wire fraud and one count of wire fraud. She faces up to 20 years in prison.