Investment Club in Tennessee Ponzi Scheme - Notorious Frauds and Schemes

Time is as Precious as Gold

In November 2004, an Etowah, Tennessee woman was ordered to pay $4.8 million in restitution and serve six years in federal prison following a guilty plea in U.S. District Court to charges she helped orchestrate an investment fraud scheme.

Dianna Blair-Torbett, 48, of Etowah, was arrested in April of 2002 on a 21-count federal indictment charging her with interstate transportation of property obtained by fraud in what U.S. Attorney Harry S. Mattice Jr., called a “Ponzi scheme.”

Blair-Torbett was arrested in 2002 along with 57-year-old Knoxville resident William Devers Brannon, also indicted by a federal grand jury at the conclusion of the investigation.

The scheme involved an “investment club”which was actually a ruse to enable Blair-Torbett to obtain money under false pretenses, said Mattice.

The Etowah woman persuaded victims to allow her handle their investments with the guarantee that the would double or triple their investment in six months’ time.

Mattice said Blair-Torbett told victims their money was secured by gold located at the West Texas Metals firm, owned by Brannon. Brannon claimed to have a process whereby he could convert common ores into precious metals such as gold and platinum, according to prosecutors.

U.S. District Judge Curtis L. Collier ordered both Blair-Torbett and Brannon to each pay $4,845,115 in restitution, but Blair-Torbett’s sentence and restitution order resulted from a guilty plea, while Brannon pressed his case to trial where a jury sentenced him on Sept. 2 to 97-months in federal prison and issued to same ordered restitution, according to Mattice.

According to Mattice, the 72-month sentence and the nearly $5 million ordered restitution are “an upward departure from the federal sentencing guidelines, which the court found was warranted due to the devastating financial and psychological harm suffered by the victims.”

Brannon received the same restitution order and a 97-month sentence to be served in federal prison, according to Mattice.