SEATTLE — Federal agents have arrested a Kirkland investment adviser Wednesday who is accused of stealing an estimated $8 million from at least 20 clients, some of whom say she spent their life savings on million-dollar homes, boats, cars and a stockpile of expensive jewelry.
Rhonda Breard, who promoted her investment expertise in television infomercials and radio spots as well as in classes at community colleges, sniffled and stared vacantly as she appeared in federal court on a mail-fraud charge.
Prosecutors said they’re trying to identify all of her assets in hopes of repaying her clients as much as possible.
“We are cooperating fully with federal authorities. We intend to continue to cooperate,” her attorney, Ron Friedman, said after the hearing.
A magistrate judge released Breard on the conditions she engage in no financial transactions of more than $500 and not transfer any of her assets.
Breard, who worked as a registered agent of Des Moines, Iowa-based ING Financial Partners since 2004, is already facing the first of what could be several lawsuits.
A couple from Renton sued her, a co-worker and ING in U.S. District Court in Seattle on Tuesday. The couple alleges that ING failed to supervise her even though in the early 1990s she was fired from Smith Barney for unauthorized trading, fined more than $100,000 for misconduct and had her license suspended for 10 days in separate incidents.
Dana Ripley, a spokesman for ING Financial Products, issued a statement Wednesday saying that the company would defend itself against the lawsuit. The company immediately terminated Breard’s securities licenses and notified authorities when it learned of her alleged actions, he noted.
The company’s efforts “have been directed at interviewing clients, investigating and documenting funds in clients’ accounts, cooperating fully with authorities, and moving toward a resolution for impacted clients,” the statement said.
The mail-fraud charge stems from an allegation that Breard mailed clients false financial statements to cover up her misdeeds. It carries up to 20 years in prison, and additional charges could be forthcoming as the investigation continues.
“We are aggressively trying to learn information about her clients and assets, and we want any assets preserved for victims in this case,” U.S. Attorney Jenny Durkan said in a news release.
Prosecutors said the case came to light early this year when an ING auditor made an unannounced visit to Breard’s office and discovered a locked file cabinet that revealed she had misappropriated money from her clients.
Some of the clients told investigators they had invested with Breard for more than 20 years. They said that a few years ago, she began asking them to liquidate those accounts and write her checks which she would then invest in new, better accounts.
Instead, they said, they later learned she had looted their funds.
Clients referenced in the charging papers said they believed they had as much as $900,000 in their accounts.
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