A Maryland investment adviser was sentenced Wednesday to 20 years in prison for defrauding investors out of millions of dollars, some of which she spent on astrological gems, cosmetic medical procedures and religious rituals in India.
U.S. District Judge Paula Xinis also ordered Dawn Bennett to pay more than $14.5 million in restitution to her victims.
A jury last October convicted Bennett of all 17 counts in her indictment, including charges of securities fraud, wire fraud and bank fraud.
Jurors heard testimony that Bennett, 57, used investors' money to pay more than $800,000 for prayers by Hindu priests in India to ward off federal investigators while her business was collapsing. Bennett paid a man in Washington state to arrange for the rituals while she faced a Ponzi scheme investigation by the U.S. Securities and Exchange Commission.
"I am in a very very tough fight going against my enemies and I need all the help I can get," Bennett wrote in an email to Puja.net website operator Benjamin Collins.
Investigators also discovered evidence in Bennett's home in Chevy Chase, Maryland, that she tried to silence SEC investigators by casting "hoodoo" spells, according to an FBI agent's affidavit. Agents found instructions for placing people under a "Beef Tongue Shut Up Hoodoo Spell" and found the initials of SEC attorneys written on the lids of Mason jars stored in Bennett's freezers, the affidavit said. Hoodoo is a set of magical or spiritual practices and beliefs with origins in West Africa.
However, jurors didn't hear any testimony about paranormal practices during Bennett's trial.
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The FBI's investigation of Bennett began in December 2015 after the SEC formally accused her of defrauding investors by inflating the amount of assets she managed and exaggerating the returns on her customers' investments.
Prosecutors said Bennett didn't tell investors in her luxury sportswear company that she was using their money to pay off other investors or to cover personal expenses, including more than $141,000 on astrological gems, more than $100,000 on cosmetic medical procedures and a $500,000 annual lease for a luxury suite at the Dallas Cowboys' home stadium
During the trial, defense attorney Dennis Boyle said Bennett was free to mix her personal and business expenses and argued that her religious practices are irrelevant.
Bennett used promissory notes to raise more than $20 million from at least 46 investors in her company, DJBennett.com, authorities said. Some of the investors were longtime friends. Others knew her from "Financial Myth Busting With Dawn Bennett," a paid weekly radio show she hosted in the Washington, D.C., area.
Many of the investors lost their life savings or retirement funds when they gave their money to Bennett, who promised them a 15 percent return on their investment, according to trial testimony.
Bennett provided investors with falsified balance sheets and other fraudulent documents to make her company appear profitable when it was in "abysmal" financial shape, Assistant U.S. Attorney Gregory Bernstein told jurors.
"The company was losing millions of dollars, year after year," Bernstein said. "She lied to them."
Boyle tried to depict Bennett as a fraud victim herself, saying she invested more than $8 million of her own money in her online business and relied on false financial numbers and records prepared by her company's chief financial officer, Bradley Mascho.
Mascho pleaded guilty last year to conspiring to commit securities fraud and awaits a separate sentencing hearing in August. Neither he nor Bennett testified at her trial.
