Wednesday, June 19, 2002

Laie scam artist
gets 26 years

Montez Ottley was convicted
of bilking people for $67 million

By Debra Barayuga

A Laie woman convicted of defrauding nearly $67 million from 5,000 investors in a Ponzi scheme characterized herself as an "aggrieved victim" and not a scam artist, invoking her faith and proclaiming her innocence to the end.

"I am not going to serve any prison term," Montez Salamasina Ottley said at her sentencing in U.S. District Court yesterday. "If you will not give me justice, then for sure, God will give me justice."

In the end, visiting U.S. District Judge Manuel Real sentenced Ottley, 57, to 26 years in prison and three months of supervised release for her role in the "Cayman Islands Investment" scam.

Real also denied her request that she remain free pending the outcome of her appeal.

A jury in February found Ottley guilty of 15 counts, including mail and wire fraud, money laundering, conspiracy to commit money laundering, structuring financial transactions and conspiracy to defraud the government. She originally had been indicted on 95 counts.

Investors, some elderly, with mid- to lower incomes from Hawaii, American Samoa, Japan and the mainland were enticed to the program, which promised an 8 percent profit a week for 13 weeks on money to be invested with the Cayman Islands government and bank.

Instead, interest payments paid to investors were taken from money invested by others, according to prosecutors.

The cash-only scheme operated for more than a year, with money being exchanged in parking lots around Oahu, before it was shut down in October 1998, said Assistant U.S. Attorney Larry Butrick.

Ottley was one of six people indicted by a federal grand jury in March 2000 in connection with the scheme. Five others were subsequently charged via complaint, including Paul Lazarro, who was characterized as a principal along with Ottley. Lazarro and the others have since pleaded to various charges and have been sentenced or are awaiting sentencing.

According to Lazarro, the scheme netted $2 million in cash per week at its highest point, Butrick said. Casino money counters had to be used to count the money.

Investors were initially asked to plunk down $1,000 cash but that figure increased to as much as $10,000, according to Butrick. One investor put down $75,000 while another risked $100,000.

At trial, Ottley said she got involved in the program by Lazarro, who led her to believe that it was legitimate.

"It was never her intent to deprive, deceive or take anyone's money, but it was an opportunity to make money," said her court-appointed co-counsel Richard Gronna.

She said she brought numerous family members into the program and that they invested close to $1 million.

"You think I can look at them if I had deceived them?" she said.

Ottley accused government prosecutors of turning her employees and even a daughter by having them testify against her at trial.

"My fight was for the people -- the investors," she added. "It was their hard-earned money."

She said she wished she knew where the $67 million went "because I would give it back to them."

But Butrick said Ottley was not as gullible as she claimed to be. He said Ottley sold the program, signed all the checks, and set the terms on how money was to be collected and disbursed.

"She ran and controlled this entire operation," Butrick said.

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