AS woman pleads not guilty in scheme | TheUnion.com
YOUR AD HERE »

AS woman pleads not guilty in scheme

An Alta Sierra woman accused of joining a $17 million investment scam pleaded not guilty Monday in U.S. District Court in Santa Ana.

A trial for Daisy M. Burlingame, 60, was set for March 26, according to court spokesman Thom Mrozek.



Burlingame is accused of joining five others while working for Morgan Weinstein and Co. of Laguna Hills in a Ponzi scheme that allegedly bilked would-be borrowers.




The company allegedly guaranteed more than $11 billion in loans to applicants, but never delivered on them despite collecting huge retainer fees.

Burlingame has declined two interview requests, other than to say she was “dismayed and distraught” from initial reports of her indictment this month. A Monday afternoon call to her Newport Beach lawyer, Diane Cavanaugh, wasn’t returned.

How Burlingame came to work for the Southern California loan broker is unclear. The case’s lead prosecutor, senior trial attorney Joel Leising of the U.S. Attorney’s Office in Washington, D.C., declined to discuss details.

Leising said Burlingame did business for Morgan Weinstein from her office at the corner of Highway 49 and Alta Sierra Drive, but the prosecutor didn’t elaborate.

Nevada County records show Burlingame bought eight acres off Brewer Road in 1999, and that her home and property had an assessed value of $359,000 in January 2000.

The U.S. Attorney’s Office began civil proceedings March 19, 2001, to forfeit the property. Leising said the civil process will be combined with the criminal case and if she’s convicted, proceeds from Burlingame’s house would go toward restitution to the alleged victims.

Another defendant, Richard Parker II, 54, of San Juan Capistrano also pleaded not guilty Monday; four others, including Morgan Weinstein’s chairman, Richard Parker, 78, of Laguna Niguel, face arraignment Feb. 19.

The six were indicted by a federal grand jury in Santa Ana on Jan. 30.

Morgan Weinstein pocketed retainer fees with the promise the fees would be returned if the loans didn’t materialize, according to court documents.

The fees were rarely refunded but when they were, the money came from other clients, the documents say.

The Nevada County District Attorney’s Office has no evidence that any county residents or businesses are alleged victims.

What’s a Ponzi scheme?

Ponzi is an advanced-loan fee scheme, or pyramid scheme, named after Charles Ponzi, a 1920s Bostonian.

He accumulated $15 million in less than a year by persuading thousands of people he had found a way to profit by trading in international postal reply coupons. No investments ever occurred.

“The only activity was the shuffling of money from new investors to old ones,” a Smithsonian Magazine article explains.


Support Local Journalism


Support Local Journalism

Readers around Grass Valley and Nevada County make The Union’s work possible. Your financial contribution supports our efforts to deliver quality, locally relevant journalism.

Now more than ever, your support is critical to help us keep our community informed about the evolving coronavirus pandemic and the impact it is having locally. Every contribution, however large or small, will make a difference.

Your donation will help us continue to cover COVID-19 and our other vital local news.

 

Start a dialogue, stay on topic and be civil.
If you don't follow the rules, your comment may be deleted.

User Legend: iconModerator iconTrusted User