Financial Fraud

Financial Fraud: STEPHEN C. BROWERE Sentenced for Using Client Funds to Purchase a Yacht and Luxury Vehicle

<h2>Founder of West Suburban Investment Firm Sentenced to Five Years in Federal Prison in &dollar;3&period;7 Million Fraud Scheme<&sol;h2>&NewLine;<p><em><strong>CHICAGO — The founder of a Geneva investment firm has been sentenced to five years in federal prison for using client funds to purchase a yacht and luxury vehicle and to trade his own stocks&period;<&sol;strong><&sol;em><&sol;p>&NewLine;<p>STEPHEN C&period; BROWERE&comma; the founder of Geneva-based Stephens Capital Management Inc&period;&comma; used the promise of lucrative and guaranteed returns to persuade several clients to purchase &dollar;1&period;66 million in promissory notes in Douglas Capital Corp&period;&comma; located in Lisle&period;  Many of the investors pledged their life savings or funds from retirement plans&period;  Browere did not tell investors that his relative was the president of Douglas Capital&comma; and that Browere ran Douglas Capital’s day-to-day operations and had access to its lines of credit&period;  Instead of investing the funds in the promissory notes&comma; Browere used the money to perform trades within his own investment portfolio&comma; and to cover personal purchases such as a yacht and a BMW automobile&period;<&sol;p>&NewLine;<p>Browere&comma; 57&comma; of Geneva&comma; pleaded guilty in June to one count of mail fraud&period;  U&period;S&period; District Judge Matthew F&period; Kennelly on Friday sentenced Browere to 60 months in prison&period;  Judge Kennelly also ordered Browere to pay &dollar;3&period;7 million in restitution to the victims&period;<&sol;p>&NewLine;<p>&OpenCurlyDoubleQuote;Each investor thought defendant was investing his or her money in safe&comma; stable investments that would provide income well into retirement&comma;” Assistant U&period;S&period; Attorney Patrick Otlewski argued in the government’s sentencing memorandum&period;  &OpenCurlyDoubleQuote;They did not agree to give defendant free reign to use the savings as his personal slush fund to support a lavish lifestyle&period;”<&sol;p>&NewLine;<p>Browere’s scheme began no later than 2007 and continued until approximately February 2014&period;  In addition to spending the victims&&num;8217&semi; funds on himself&comma; Browere concealed the fraud by using principal payments from some investors to make interest payments to others in a Ponzi-like fashion&period;<&sol;p>&NewLine;<p>Browere also obtained the power of attorney on behalf of an elderly client who was infirm and suffering from dementia&period;  The power of attorney gave Browere access to the client’s cash and property&comma; which were valued at more than &dollar;2&period;1 million&period;  Browere misappropriated some of this money to purchase four vacant lots in Lisle and to make interest payments to other clients&period;  After the client died&comma; Browere maintained control over the estate and continued to misuse the estate’s assets&period;<&sol;p>&NewLine;<p>The sentence was announced by Zachary T&period; Fardon&comma; United States Attorney for the Northern District of Illinois&semi; Jeffrey A&period; Monhart&comma; Regional Director of the Chicago Regional Office of the U&period;S&period; Department of Labor&comma; Employee Benefits Security Administration&semi; and E&period;C&period; Woodson&comma; Inspector-in-Charge of the U&period;S&period; Postal Inspection Service in Chicago&period;  The Illinois Secretary of State’s Office provided valuable assistance in the investigation&period;<&sol;p>&NewLine;<p>The government is represented by Mr&period; Otlewski&period;<&sol;p>&NewLine;<p><a href&equals;"https&colon;&sol;&sol;www&period;justice&period;gov&sol;usao-ndil&sol;pr&sol;founder-west-suburban-investment-firm-sentenced-five-years-federal-prison-37-million">Original PressReleases&&num;8230&semi;<&sol;a><&sol;p>&NewLine;

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