Guilty plea in Ponzi case
OGDEN -- Bonnie Smith Leavitt pleaded guilty Wednesday to a Ponzi scheme investigators say touched nearly 30 victims.
Sentencing was set for Leavitt for Aug. 26 while the defense and prosecutors try to agree on restitution. Currently the two sides, respectively, argue $604,000 versus $690,000.
Leavitt, 43, has admitted to ripping off investors with a real estate scheme promising a monthly investment return of 18 percent or more.
Police said she also forged trust deeds and notary public seals as part of the scam, which she pitched as an effort to fund mortgages for battered women.
While some property may have been purchased initially, the project turned into a Ponzi scheme in which new investors' funds were used to pay the promised returns to prior investors.
Some 15 to 20 victims with friends and family attended the hearing, which was conducted with little comment and no testimony, unlike the coming sentencing hearing. At sentencing, victims will be allowed to address the court about the impact of Leavitt's crimes.
The Washington Terrace woman had been charged with four counts of communications fraud and four counts of theft by deception, all second-degree felonies, and three counts of forgery, a third-degree felony. Investigators said the scheme was ongoing from January 2008 until her arrest earlier this year.
Wednesday she pleaded guilty to five amended charges in return for dismissal of the prior complaint and its 11 counts. The charges she pled to are second-degree felony counts of theft by deception, communications fraud, and securities fraud, and third-degree felony counts of communications fraud and securities fraud.
The final restitution figure will be much less than the $2 million speculated in the more than 275 comments attached to articles about Leavitt posted on the Standard-Examiner's Web site, www.standard.net. Many of those readers called themselves Leavitt's victim.
That figure was likely inflated based on contracted returns the investors expected but never received from Leavitt, officials said.
Defense attorney Don Sharp told the court Leavitt would be filing bankruptcy. Restitution owed via criminal charges can not be blocked by bankruptcy proceedings.
Some investors who did receive returns from Leavitt may have to forfeit those earnings to the bankruptcy trustee under federal bankruptcy law.