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Saturday, April 8, 2000

Accused Ponzi schemer
must remain in custody

By Susan Kreifels


A federal judge ruled that a Laie woman accused of operating an international Ponzi scheme must stay in a secured facility because of the government's fear she will flee or intimidate potential witnesses who were investors in the alleged scheme.

U.S. District Judge Helen Gillmor said yesterday that Montez Salamasina Ottley, accused of defrauding some 4,000 investors of more than $40 million, must stay at Miller Hale, a halfway house. She can only leave to meet with her lawyer or for pretrial matters.

Ottley, 55, is currently in jail. Gillmor said Ottley must remain there until a $200,000 bond is posted, then she can go to Miller Hale. Ottley plans to use a family home in Kaneohe to secure the bond.

The judge also told Ottley she could speak only with members of her immediate family and warned her not to contact, threaten or intimidate investors or witnesses.

Deputy U.S. attorney Larry Butrick said he was not intimidated by Ottley's "mindset."

He said Ottley's elderly investors were "terrified" because she threatened that "if you cooperate with the feds, you will never see a dime of money again."

Butrick also said Ottley had shown disrespect for the court.

Ottley had insisted she would represent herself but yesterday told Gillmor that court-appointed Lane Takahashi would be her attorney.

Last week a federal magistrate entered a not guilty plea for Ottley because the accused woman said the charges were unconstitutional and that she was a citizen of the Hawaiian kingdom.

Federal prosecutors say Ottley is one of two leaders of an alleged scheme that enticed investors in Hawaii, American Samoa, Japan, the mainland and elsewhere.

Their money was not legitimately invested but diverted to the defendants for their personal use, according to prosecutors.

Most investors were from Hawaii, with the scheme running from June 1997 to October 1998.

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