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More than 15 investors sent money to Jenifer Devine, 39, and her paper company, which purported to sell clothing and electronics.
Part of the attraction apparently was Devine herself, who told the unwitting investors she ran a company that sold “top designer products at trade prices” and used a fetching photo, purportedly of herself, as a come-on.
“Why pay full RRP prices when you can get them up to 75% cheaper through direct trade,” she wrote in her ad. “[I] can supply such names as Louis Vuitton, Gucci, Guess, Oakley, Dior, Nine West, Chanel, [L]evis and much more all at trade costs.”
No, she couldn’t, Devine told a federal judge in Newark on Thursday.
“Devine’s wholesale business was wholesale fraud,” U.S. Attorney Paul S. Fishman said. “Victims who were promised huge returns paid the tab for the defendant’s vacation and designer goods. This case reminds investors: Always be wary of a sure thing.”
Assistant Special Agent in Charge David Velazquez of the FBI’s Newark Office said Devine played on the “basic human flaw” of greed overriding good judgment by making “grandiose promises” of returns that were virtually impossible to fulfill.
Using a Grand Street address, Devine Wholesale solicited short-term investments from New Jersey and throughout the United States of between 30 and 60 days that promised a quick 25-percent payout, the government alleges.
“Devine also showed some investors fake inventory lists of products she claimed to be reselling,” a statement from Fishman‘s office said.
In reality, “Devine Wholesale had no active wholesale clothing or electronics business… and had virtually no business sales.”
She used new investor funds to make principal and interest payments to existing investors, as well as to fund her own lifestyle, federal prosecutors said. In one instance, she simply wired $10,000 to an investor in New York that she had received from one in New Jersey, they said.
Sentencing is set for Dec. 20.
Fishman credited Special Agents of the FBI with making the case, which was prosecuted by Assistant U.S. Attorney Matthew E. Beck of the Economic Crimes Unit in Newark.
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