According to the Detroit News, documents filed in US District Court in Detroit accuse Candice D. Campbell of CJ's Financial of organizing and conducting the operation from April 2009 to August 2010.
The fraud charge, which claims Campbell acquired more than $1 million from investors, carries a possible 30-year prison sentence, according to the news provider.
Throughout the scheme, Campbell reportedly told investors that her company was gaining profits through the penny stock market, allegedly guaranteeing a return of between 10 and 20 percent each month, the court documents show.
Campbell, who served as owner and chief financial officer of the company, is also accused of telling investors that they could withdraw their money whenever they wanted without losing the original value.
In addition to allegedly sending false monthly statements without ever investing the money, Campbell is accused of telling investors that their accounts had been frozen by the US Securities and Exchange Commission when they requested that their money be returned.
Some of the items Campbell is accused of purchasing with the money from investors include a 2006 Pontiac Grand Prix vehicle, thousands of dollars in jewelry, televisions, computers and iPods, according to court documents.
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According to the news source, former Primary Global Research consultant Winifred Jiau was convicted in Manhattan federal court for fraud related to insider trading, in which she reportedly gave information to hedge fund managers about Nvidia Corp. and Marvell Technology Group.
The 43-year-old Fremont native faces as many as 25 years in prison when she is sentenced in September by US District Judge Jed Rakoff, the news source said.
The news provider reports that Jiau's conviction represents the third trial win for the US government regarding insider trading in connection to hedge funds.