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For week ended April 02, 2000 Posted 24 Feb 2001
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Sent on Mormon-News: 05Apr00

Summarized by Kent Larsen

Prosecutor Claims LDS Woman Ran Ponzi Scam
Honolulu HI Star-Bulletin 31Mar00 D2
By Rod Ohira: Star-Bulletin

LAIE, HAWAII -- An LDS woman who says she "lives my religion seven days a week," has been charged by U.S. prosecutors with leading an International Ponzi scheme that allegedly solicited more than $40 million. Montez Salamasina Ottley, 55, was charged in a 100-count indictment for mail or wire fraud, money laundering and other offenses that allegedly occurred between June 1997 and October 1998. Ottley was charged along with John Wright, 40; Shyuan Tan, 33; Stephen Marn, 65; Helen A. Schlapak, 59; and Rande Scott Worcester, 43. The offenses could result in lifetime prison sentences for each and fines totaling $2.75 million.

The charges are in the wake of the guilty plea December 20 of Paul Lazzaro, 56, who is scheduled to be sentenced for his crime on October 16th. Lazzaro also gave up more than $400,000 and two cars to police. Lazzaro was allegedly part of the "Cayman Islands Investment Program" which promised fees or interest of 8 percent a week for 13 weeks on money that the group claimed was invested with the Cayman Islands government and banks, according to U.S. Attorney for the district of Hawaii Steven Alm. According to Alm, the money paid out to investors actually came from subsequent investors.

The scheme attracted more than 4,000 investors from Hawaii, American Samoa, Japan, Singapore and the U.S., most of whom made cash investments of $1,000 or more. "This was a house of cards which fell that damaged so many lives," said Alm. He says he was shocked to find that investment meetings were held at churches and in people's living rooms. Prosecutors say they have recovered more than $2 million, and are trying to figure out a system for distributing the money to the victims.

Ottley, who is also an activist for Hawaiian sovereignty, chose not to accept a court-appointed attorney at her arraignment on March 30th, and refused to acknowledge the charges against her, telling the judge, "I am not under your jurisdiction." She says she is a "citizen of the Hawaiian Kingdom." "I'm not about to flee. I'm not a bad person. I've given everything away to the people. There will be justice served. I will fight to the bitter end."

Ottley's "friend and counsel," Aran Alton Ardaiz, says that Ottley is innocent. He says she "had no idea the man (Lazzaro) she was working under was a Ponzi schemer."


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