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Kirkland broker Rhonda Breard to spend nearly seven years in prison for fraud
Kirkland Financial planner Rhonda Breard was sentenced Wednesday in U.S. District Court in Seattle to six years and eight months in federal prison, meeting the prosecutors and defense attorney’s separate demands in the middle.
The former chief executive officer of Breard and Associates Wealth Management in Kirkland was initially charged on March 10 on a single count of mail fraud in connection with a scheme to defraud dozens of clients out of millions of dollars. The court was packed with many of her victims crying and embracing each other.
In court, Breard made a very brief statement, struggling to compose herself: “I’m very sorry, more than you’ll ever know … I feel I deserve the maximum amount of years.”
When Assistant US Attorney Carl Blackstone announced in court that prosecutors had decided on recommending a 97-month sentence for Breard, a woman gasped. Prosecutors had cited her cooperation with authorities ever since the fraud came to light after an audit by ING in February 2010. Blackstone said after that, she immediately reported her actions to the government. Breard’s attorney, Ronald Friedman, recommended five years and eight months.
Several of her victims spoke, many of whom lost their entire savings. Breard intends to send letters of apology to her victims after sentencing, but victim Shelly Heath said it would do nothing to repair the image of the “lying, stealing, fraudulent financial advisor,” that she invested with for 25 years. In her account were her retirement savings and her children’s college education fund.
“No words are needed or wanted from Rhonda … what I need is for Rhonda to step up, return the money and for the court to issue the maximum sentence,” Heath said.
Sentencing documents give the most recent amount of how much she stole from her investors, according to The Seattle Times: 43 of her roughly 100 investors lost $12 million, nearly $2 million more than previously reported while she was licensed under ING. Prosecutors now believe that Breard started the scheme in 2000 – four years earlier than previously thought, according to Assistant US Attorneys Blackstone and Matthew Diggs. They did not think it was intentional that Breard didn’t tell them about that.
“If she stole my money, I’d be just as angry as they are,” Blackstone told the judge. “That damage will take years to remedy.”
The sentence issued by U.S. magistrate judge Marsha Pechman was below the 8- to 10-year guideline range for this crime. Breard won't have to report to prison until her children, ages 9 and 11, are back in school, said Pechman, and she will be able to surrender herself. Friedman had hoped for a lighter sentence because she will get out of prison before the children turn 18.
Breard will also get three years of supervised release with a number of conditions, which will be the “real proof” of reform, Pechman said. She won’t have to pay a fine, because the money Breard earns once released should go to restitution, Pechman said.
Breard took the money from clients, telling the investors the money would be placed in a variety of financial and insurance products. Instead, Breard used the money for her own expenses and mailed phony statements to these customers. Her fortune brought her three sprawling mansions – including a home for $2.6 million on Lake Washington --and 27 cars, trucks, boats and recreational vehicles. The vehicles include a 2009 Cadillac Escalade, a 2009 Mercedes-Benz SL 550, four Yamaha ATVs, three Kawasaki jet skis and six Ski Doos. investigators also seized mobile homes and other exquisite items.
The former financial planner said she was driven by greed and the need to appear rich.
Breard’s demeanor at her sentencing was a stark contrast to the energetic commercials that she ran on local TV stations to entice investors, entitled “Help me Rhonda.” After victims spoke, Breard told them she hoped that they would learn to trust financial advisors again.
"I feel exactly the same way you feel," Breard said, motioning to her victims. "I took my god given talents in a way of corruption.”
US Attorney for Western Washington Jenny Durkan said in a press release in March that victims would come to trust Breard with their money after “hearing her speak at investment classes at locations such as community colleges.” Some of them “had invested with Breard for more than 20 years."
Lynn Hart used to work at of Breard and Associates Wealth Management and walk Breard’s dog.
“You were charming you were smart, you were intelligent,” Hart said. “Not only did you steal every cent I had, but you were my best friend … how could you look me in the eye at Thanksgiving dinner and say ‘everything’s going to be great.’”
Among them in court Aug. 11 was an autistic man who lost his entire savings while working as a janitor and other small jobs. His care giver, Dorothy Frish, spoke on his behalf.
After she lost her ability to act as a broker in nine states, including Washington, her office at 404 Lake Washington Blvd. was closed. On Feb. 10, she attempted suicide twice at home, according to two sources.
She attempted to sell a "huge" amount of jewelry on February 27 to Elegante Jewelry in Bellevue, whose owner refused after learning of her identity.
After it all came to light, the government seized the lavish items at $250,000 in cash and checks.
Many of the assets were significantly mortgaged. The cash and the seized assets will be sold at an auction in the fall, and ultimately be provided to the victims of the scheme, according to Emily Langlie, spokeswoman for the US Attorneys office.
At sentencing, the order of forfeiture was signed. The items are in government custody.
ING has reimbursed some of the victims and will reach settlement with the victims in two months, they told the US Attorneys office.