Scamfluencers - Live, Laugh, Lie

Episode Date: June 19, 2023

As a young girl growing up in Michigan, Gina Champion-Cain dreams of becoming a business woman. After she moves to San Diego, she makes a name for herself as one of the city’s most influential developers. She appears on magazine covers and takes credit for revitalizing downtown. When she starts shilling loans for liquor licenses, investors think it’s a slam-dunk… until they discover the entire scheme is built on a lie.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Hey, prime members, you can listen to scam influencers add free on Amazon music. Download the app today. Sachi, would you say we're kind of experts in girl bosses? Yeah, I think that's how we got here, right? Okay, do you think there's like a world in which you could have capitalized on leaning in? I think there's like a world in which you could have capitalized on leaning in. I had a job a couple of jobs ago and when I started, my boss made me read lean in. And then you're like, I'm going to do the opposite.

Yeah, I think he wanted me to lean in and I so resented the suggestion that I even try that it made me lean out. Well, this scammer I'm going gonna tell you about really leaned in. Like, a little bit too much. Get ready for one of the most convoluted girlboss scams we have ever covered. On a sunny afternoon around 2016, Gina Champion Kane sits down

at a Michelin starred restaurant in Napa Valley. Gina is a successful real estate developer in San Diego. She's used to wheeling and dealing at work lunches like this one. She's in her early 50s with long black hair, a megawatt smile, and the permatanned skin of someone who spends every spare minute on the golf course. Kim Peterson sits across from her. Kim's got a large forehead and a white mustache. He met Gina at a real estate conference a few years earlier. They both live

in Southern California, but Kim insisted they take his private jet to lunch more than 500 miles away. Gina's been working with Kim for a few years now. They make short-term loans for people trying to get California liquor licenses, which are very expensive, but highly lucrative once you have them. Kim's the money and Gina's the brains running the whole operation. They've made a tidy profit, and over-halibut in duck, Kim tells Gina he wants more. More licenses, more loans, more high-interest returns. I can't see how this could ever go wrong. Well, when the board Kim's private jet for the flight home, Gina sits next to the pilot.

They soar to 12,000 feet, and then Kim says that when they land, they'll tally up the cost of gas and they can split it. Gina's dark eyes go cold. She reaches over, grabs a control away from the pilot of gas and they can split it. Gina's dark eyes go cold. She reaches over, grabs a controls away from the pilot and pulls them back. The plane tilts straight up into the clouds, Kim screams, what the fuck are you doing? A few rapid fire heartbeats later, Gina releases her grip and the pilot regains control. Gina turns to Kim and says, I am not splitting the gas bill with you.

Okay, if this sounds too outrageous to be true, it almost certainly is. This is a story Gina tells in her memoir. It was published years later and is colorful. We spoke with Kim Peterson for this episode and he says none of this ever happened. Whether she actually violated FAA guidelines or not, Gina wants to make a point,

even if it's just in her memoir. She's a nobody's partner, she's the queen. In this lending program she's running is a lot more than a side hustle. It's a year's long Ponzi scheme. It's captured hundreds of investors and pumped millions into her pockets. But the higher they saw, the farther they fall.

And when Gina's thrill ride comes to an end, all her investors, including her family and some of her oldest friends, will be taken down with her. Hi, I'm Lindsay Graham, the host of Wondries Podcast American Scandal. Our newest series looks at the story of OxyContin, a popular painkiller that helps spur an epidemic of addiction and drug abuse, in which prompted a broad campaign to hold the pharmaceutical industry accountable. Listen to American Scandal on Amazon Music or wherever you get your podcasts.

Many involved in crypto saw Sandbankman Freed as a breath of fresh air from the usual Wall Street buffs, but in just one month, his crypto exchange would collapse. From Bloomberg and Wondery comes Spellcaster, a new six-part docuseries about the wild rise and fall of FTX and its founder Sandbankman Freed, listen to Spellcaster on Amazon Music or wherever you get your podcasts.

From Wondery, I'm Sarah Hackie, and I'm Sachi Cole. And this is Scams Wincers. Come and give me your attention, I'll pull that vulva move I'll say, tell my speaker, you are loving, I feel like I'm lushing. Gina Champion Kane is a real piece of work. She's an ambitious boomer girl boss who fell on tough times, then decided to rob her business connections blind because they were too sexist to know better.

At least that's how she sees it. Get ready for a lot of hustle culture uptalk, real estate developer arrogance, and half-baked second-wave feminist bullshit. And if those aren't enough red flags, she's got a whole path of golden retrievers. I call this episode, Live, laugh, lie. It's 1980 and Gina Champion is in an apartment building leasing office shuffling piles of paper.

One pile is lease agreements and Checks. The other is her math homework. Gina's a 15-year-old and Ann Arbor Michigan with a lot of confidence. She's an A student and she plays field hockey, and on top of that she just got promoted. She started working at her stepbathers' complex of apartment buildings three years ago, cleaning laundry rooms and mowing the grass. Now, she helps out in the leasing office. So even though many tenants are surprised to have a literal child harassing them for rent, Gina knows she's earned her place.

Remember when I told you that Gina wrote a book? Well, it's an as-told-to-style memoir and it's self-published. And the title is, I swear to God, Sachi, I did it. Which tells you a lot about Gina and her general attitude about things. Yeah, she sounds like a real go-getter. She just sounds like someone who's very motivated to do it, whatever it is. Well, I have to warn you, Gina's not the most reliable narrator. But a lot of what we know about

her early life comes from her memoir. In it, she says it's this early gig working for her stepdad that introduces her to the world of real estate. She's by his side as he converts the apartments to condos, and she's fascinated by the high stakes negotiations and the contracts with lots of zeros. She says she dreams of one day building something of her own. A few years later she graduates from the University of Michigan in her hometown. And when she looks around Ann Arbor, she sees a small world, the only one she's ever known. It's time to think bigger, rander, and warmer. So she applies to the California Western School of Law in San Diego and gets in. This Midwestern girl is ready to make her mark.

Gina arrives in San Diego in 1987. In her memoir, she says the only person she knows in town is her prom dates older brother, a guy named Steve Cain. And he's kind enough to take her out for a welcome dinner. Gina says she's immediately drawn to him tall with light eyes and dimples. Steve's every bit as ambitious as Gina. But he's got a steadiness and concentration that Gina lacks. Her mind's always racing at a hundred miles per hour. Gina remembers they went to a chain seafood restaurant that looks out over the ocean. Gina remembers they went to a chain seafood restaurant that looks out over the ocean.

She writes that he orders a gin and tonic and she has a heineken. They talk about friends from back home and Steve tells her about his job working for his family's furniture business. Gina calls her mom the next day and tells her, I don't think he likes me very much but I'm gonna marry him someday.

A year later, Gina transfers from law school to business school. She wants to run her own company one day and make lots of money. In 1990, three years after their first date, she and Steve get married. She gets her MBA and joins a multi-billion dollar real estate firm called Cole Company. Gina's going full corporate, doing deals with the big dogs. In her memoir, Gina has a lot to say about how she worked hard to be taken seriously in the machismo real estate development world. But she's not above using all her resources to get ahead.

Sachi, can you read what she writes about her approach to the leaning in? Yeah, she says, the company was filled with nice white man, and let's face it, they were suckers for long legs and cookies, and I had both. That is, I could bake. I am not mad at her about this at all. If the menu work with her this week, by all means. These guys want cookies and this girl bakes. That's all I'm adding her about this at all. If the men you work with are this weak, by all means, these guys want cookies and this girl bakes.

That's all I'm gonna say. She also takes up golf to network. In her memoir, she writes that she wears quote, the cutest golf outfits. Those little dresses that just cover your butt. And I'd work it when I was playing with the men, which was most of the time. Gina works on all kinds of projects at Cole,

including building American-style malls in Japan. And she also starts, shall we say, projecting success. She allegedly exaggerates her contributions to lots of cold projects. For example, in the early 90s, the firm is working on a $60 million renovation of La Jolla Village Square, a mall in San Diego. One of Gina's former co-workers later tells the San Diego Union Tribune that Gina was part of a team that recruited tenants to the mall. But in interviews over the years and in her memoir, Gina takes a lot of credit for that project. She makes it sound like she basically took over from a bunch of bumbling dudes

and ran the whole thing herself. For years, Gina's been baking cookies for the man, but from now on, she'll eat everything herself. In 1997, after several years at Coal, Gina leaves to start her own company, American National Investments. She needs a major project to put her own company, American National Investments. She needs a major project to put her firm on the map. And a year later, she finds the perfect opportunity

in the heart of downtown San Diego, a vacant building that spans an entire city block. It used to be a Woolworths department store, but the company went under. This part of town isn't doing great, but all Gina sees is potential. So she buys it for $2.5 million and starts making deals to fix it up. Around the same time, Gina also starts working with a public relations whiz.

She wants to make sure that all of San Diego shares her high opinion of herself. The investment pays off. In the early 2000s, you can't swing a surfboard without hitting some local top business leader list she's on. San Diego Metropolitan Magazine runs a spread where she's photoshopped into the city's skyline, hugging a skyscraper like a Karen Godzilla.

Take a look, Satchie. Oh, she does look like Godzilla in terms of scale, but, you know, she's wrapped her arm so tenderly around one of these buildings. This is like a, like, a sweetie Godzilla. And she looks great. I can see why people are eating her cookies, you know? She's a pretty woman.

She is. She's very cute. Well, the biggest spot of all is when Gina appears on the cover of San Diego magazine in 2003. Sachi, can you describe this cover girl moment? Yeah. It's a magazine cover with Gina standing on a monopoly board. I can't see what road she's on. But it's her and another landlord, and it's about who owns downtown.

Yeah, it's all good vibes. Landlords on a monopoly board. They're making the rental hellscape fun. In a San Diego business journal profile that same year, Gina's asked about her business philosophy. She says, I run a tight ship when it comes to ethics and she adds, my reputation means everything to me. Things are going so well for Gina that she even considers running for mayor. A year after that, the House of Blue San Diego

opens on the ground level of the former Woolworth building. Gina tells everyone that she's responsible for bringing the house of blues to town and brags about her success. But a former developer on the project told the San Diego Union Tribune years later that Gina had a much smaller role. Gina's relentless self promotion has convinced at least some of the San Diego business community

that she's the one woman machine revamping downtown. She's named to two of the city's influential redevelopment boards and a year after the House of Blues opens. The city declares June 28th, Gina championed Cain Day for her many contributions to the area. But Gina's career and her reputation

as a real estate girl boss are about to get tested and how Gina responds will change San Diego forever. In 2008, the recession hits Gina hard. Tons of deals she had in the works just fall apart. And then, about a year later, things get even worse. She starts working with a few partners to develop the land near Petco Park where the Padres play.

They wanna put in a hotel, condos, office space, and some shopping. They start talking to a guy who says he represents a group of wealthy European investors. And this guy's name, I swear to God, is Johnny Condo. Well, I mean Sarah, you know what my real name is, right? Is it Sachi podcast? Yeah, it is Sachi podcast.

You know how Hollywood is. So yeah, well, Gina puts more than $150,000 of her own money into the project. But Johnny Kondo keeps putting her off. By the end of 2010, Johnny and his team ghost Gina. He never sends her any money for the project, and it comes to light that the whole thing is a Ponzi scheme. Johnny Condo and his co-scammers are arrested and all of them go to jail. Gina even testifies at the trial in Boston,

and she says in her memoir that the whole thing brings her to the brink of financial ruin. By this point, her husband, Steve, has also started his own business making eco-friendly alternatives to packing peanuts. But Gina's always taken pride in working hard, getting results, and providing for herself. Now, her career's on the skids

because a group of men cheated her out of more than $100,000. Gina later calls this time her desperation point, but nothing, not even a villain like Johnny Condo, is going to keep this girl boss down. A few months after she gets burned by the Ponzi scheme, Gina stands outside of a run-down restaurant. It's an asleepy oceanfront neighborhood of San Diego. Gina's decided to buy the land, tear down the restaurant, and build apartments with some retail on the ground floor.

But the neighborhood loves having a restaurant there, and they threaten to block her project. But then she discovers that the restaurant comes with a very valuable perk, a liquor license. Liquor licenses are super expensive in California and hard to get, especially in this neighborhood. The state has decided that there are already plenty of bars here, so it won't grant any new licenses. One of the only ways to get one is to be grandfathered in by buying a restaurant

like this one. So she decides to go into the restaurant business. She finds a new chef and a manager and draws up renovation plans. While renovations are underway, Gina gets a phone call from a guy buying a restaurant just outside of Los Angeles. He's looking to get a liquor license and a mutual connection suggested Gina could help. She explains what the thing about California liquor licenses is you need to put the entire cost of the license, which can be up to six figures in an escrow account while the state reviews your application. Escrow accounts are super secure because people who deposit money have to approve anyone trying to take money out.

But this guy says he doesn't have that kind of cash on hand. So Gina offers to front him the funds, and of course, she'll charge interest at a rate of 18%. I mean, 18% seems extremely high. Yeah, I mean, it's not as steep as a sketchy payday loan kinds of options, but 18% is really high for a regular business loan. It's great for Gina, though. Whether this guy gets approved for the license or not,

Gina will get her money back with interest. She brings a friend into the deal, and together they put up $100,000. After five months, the guy gets his license. Gina and her pals with the 18 grand in interest. The guy is so grateful Gina gets to thinking. Maybe there's more people out there like him who need these short-term loans. It's easy money and it's coming at just the right time. Her new restaurant has a broken kitchen, a clogged grease trap, and a leaking roof. It needs $600,000 worth of renovations, staff.

Gina hopes this side hustle will be the key to getting back on top and staying there. And she'll do anything to make that happen. I feel like a... Gina's restaurant, the patio on Le Mans, debuts in November 2012. On opening night, the outdoor fire pits crackle and the standing room only crowd sips cocktails in front of a wall of plants. Gina beams with pride. It's the restaurant of her dreams. She's interviewed on a YouTube channel

called California Life with Heather Dawson. The patio on Lamont Street is at the beach, and you feel like you're at the beach, of a beach cottage, really reflection of when you come to my home to eat. This is the atmosphere you would experience. But behind the scenes, Gina is spending a reflection of when you come to my home to eat, this is the atmosphere you would experience. But behind the scenes, Gina is spending a lot of time trying to provide short-term loans

for people applying for liquor licenses. It hasn't been a problem to find investors. Seems like easy money, and there's one investor who's especially eager. Kim Peterson. Sachee, do you remember Kim? Oh, the guy who wanted to split the gas bill? Yeah.

Which he says didn't happen to be fair. Yeah, okay. Well, Kim and the other investors want to get going. Problem is, there just aren't that many people who need these kinds of loans. But Gina needs cash, because even though her restaurant is open, there's still a ton of work to do.

And the renovations are not cheap. Gina might be thinking back to her experience with Johnny Condo. That was a huge setback, but also a learning opportunity. Maybe she can take the investor's money and just not use it for loans at all. She could use it to finish her renovations. Eventually, she'll find people who need loans and she'll make those legitimate deals and pay everybody back. Every time this exact financial arrangement happens, it definitely works.

Pretty foolproof if you ask me, yeah. Well, to make this work, Gina still has to find liquor licenses that supposedly need loans. One Saturday night, not long after Gina's restaurant opens, she's at home. She and Steve live in Mission Hills, a wealthy neighborhood north of San Diego. It has views of the downtown skyline in the bay, and Gina's in her office sitting at her computer with three golden retrievers sleeping at her feet. Steve's gone to bed, but Gina's scrolling the website for the state's liquor licensing agency. As Gina tells it, it's a typically clunky government website. You have to

know a license number to look it up, but when you do, there's no information on its history or even whether it's active. Gina realizes that if she gathers legitimate license numbers to show potential investors, they can verify that the licenses are real. But they can't tell if someone is trying to buy that license or find out if it's expired. The investors are so excited about the opportunity, Gina's willing to bet that they won't have the patience to dig any deeper. Over the next couple of weeks, Gina stays up late entering random numbers,

hoping to stumble upon existing licenses. Eventually, she finds six of them, all for businesses in Northern California, far from the small world of San Diego bars and restaurants. Likker licenses can cost tens of thousands of dollars if not more. So Gina rounds up and lists them all at $100,000. It's enough to cover the remaining renovations for the restaurant. Gina puts the licenses together in a proposal.

She's ready to get back in the action, even if it means committing fraud. Around this time, a woman named Jane Gilbert hears from an old friend, Gina. Jane and Gina were roommates while attending Cal Western Law School. Jane stuck it out at law school after Gina left, but they stayed close. Jane went to Gina and Steve's wedding. They go to chargers and podres games together and have each other over for the holidays. Gina tells Jane she has something to talk to her about. So, Jane invites her over. She serves homemade appetizers and pours wine. Gina tells Jane and her wife that she started a great new investment opportunity,

pooling money into a fund for liquor license loans. Gina says it's a slam dunk, and that the money is so good even her parents are investing. Gina says she's working with an attorney who's connecting her to the applicants. She says she has six applicants so far, but of course all of this is bullshit. Gina is not working with any attorney and these are the six numbers she randomly found on the state website. Jane and her wife both work for the county at this time. They don't have a ton of money, but Gina's a friend and she is so successful. Jane trusts her, so they cut her a check.

Gina's making this pitch to everyone she knows. But even after she raises the money she needs to cover the renovations at her restaurant, Gina doesn't stop. She keeps inputting random numbers into the state's website for liquor licenses. She finds new ones and new investors and uses their money to pay off the earlier ones. It is a classic Ponzi scheme. But Gina's dream of regaining her spot

at the top of San Diego's business community will come at the expense of her family, friends, and every professional relationship she's built along the way. Not all of Gina's investors are long time friends. She's also dealing with people like Kim, big time investors who have big time money. She has to make her loan program look legit enough to convince them. So she starts working with Chicago Title.

It's owned by Fidelity National, and it's one of the biggest escrow companies in the US. When Gina tells potential investors that their money is in Chicago title accounts, they trust her even more. She knows some of the employees at the company's San Diego office, two women in particular, Della LaSharm, and Betty Elexman. Della's blonde and love spending time with her kids. She's climbed the corporate ladder and is a senior commercial escrow officer. Then there's her assistant, Betty.

She's in her 50s with brown hair and a side gig selling fancy kitchenware. They create accounts for Gina's investors who then sign agreements saying they have to approve withdrawals. It's all standard stuff and it's what makes Escrow accounts super secure. But Gina ends up scrapping the agreements. Then she forges her investor signatures on new ones that say she can take out money any time she wants. There's no evidence that Dela and Betty were in on the scheme or knowingly helped Gina

carry it out. They were investigated by the Justice Department, but neither has been charged with a crime. We reached out to their attorneys, but only Betty's responded and declined to comment. Chicago title has also denied that its management was knowingly involved in Gina's scam. Its lawyers later wrote in a filing to the DOJ that, quote, to the extent that there was misconduct at Chicago Title Company, it was limited to a single escrow officer and her assistant in a single office. So does that mean Chicago Title is just like throwing these two under the bus?

That is what it sounds like for sure that it was limited to these two employees in their relationship with Gina, got it. And in her memoir, Gina describes herself, Betty and Della, as a gang of professional women lashing out at the patriarchy that has held them down for so long. She says she treats them like queens in the court of Gina. She allegedly praises them in emails, hands-out cash bonuses, serves them free food and drinks at her restaurants, and offers them seats in luxury boxes at sporting events. She even allegedly pays for delas vacations at times.

A later lawsuit includes an email Gina wrote to an employee of an unnamed escrow company, which we can only assume is Chicago Title Company. In it, she writes, I have always promised you I would shelter you for my crazy investors and I will continue to do so. Can you read the rest of what she writes, Sachi? Yeah, it says, if any of the investors bug you as they are too stupid

to understand the program, they are quote fired as an investor. I have plenty of dudes dying to give me money, honey. Ahaha, ahaha, ahaha. And then, and a modicon, not an emoji, and a modicon of a smiling face, and then love you ladies. Exclamation work.

I would be sucked into Gina's world. She sounds fun. Yeah, you know what, listen, I'm down with her misandrous version of Girlbossing. It is appealing to me as someone who hates everybody, but especially men first. So this is the closest I feel like we've ever gotten

to a scam where I understand it, and I get the impulse. Well, within its first year, Gina's liquor license scheme has attracted dozens of investors and allegedly generated more than $8 million. So she decides to funnel money into some other career dreams. She's been buying beachside houses and turning them into dog-friendly short-term rental properties. And she funds a retail store called Love Surf. That's L-U-V that sells clothing and accessories geared toward the beach and dog crowd. Our people, Sachi, and she opens more

locations of the patio, though the first one has yet to break even. She buys her favorite boho chic coffee shop and opens a special culinary store. She starts a CBD line, acquires a chocolate truffle company, and even invests in a fitness accessory for infant car seats. Whatever those are, Gina is living large. In this whole time, she swears her husband's Steve is none the wiser. He's just enjoying their new house in Rancho Marage and the golf course attached to it. Gina's using her investors' millions to reign as the queen of San Diego, but even the

biggest returns won't silence questions forever. In late 2016, Michael Brewer gets a call about a program that might be of interest to his clients. Michael's got graying hair and the easy smile of someone who talks about drinking all day. He's the president of the alcoholic beverage consulting service and the co-founder of a liquor license brokerage company. So obviously, he's an expert in the California liquor license game. The call is from Kim Peterson. By this point, he's convinced hundreds of people to invest big money with Gina.

At least 17 of them gave more than $1 million each. And of course, Kim gets a cut of the profit when he brings new people in. Now, he wants to talk to Michael about getting involved. Michael actually knows Gina already. He helped her get a liquor license for one of her patio restaurants a few years back. So he drives to Kim's office in Del Mar, north of San Diego, to hear about the program.

We spoke to Michael for this episode, and he says that Kim brought him into a conference room with a long table and had him sign an NDA. But when Kim explained the program, Michael knew something wasn't right. But when Kim explained the program, Michael knew something wasn't right. Your members telling Kim that while technically, California laws as people have to provide the money for a license upfront, it almost never works that way in practice. They can just write an email asking for an extension, and they'll almost always get it. He says most people deposit less than 10% of their total payment before the state approves or rejects their application. Michael tells Kim that he just can't recommend this program to his clients.

Your members Kim shaking his head as if Michael wasn't getting it. After all, Kim seemed Gina pumped out these loans for years and everything's backed by Chicago title a very legit company. Man, Kim's really deep into this. Like even when the facts are laid out in front of him by someone who knows better, he still can't see it.

Yeah, I mean, this guy is an expert in this. And Kim's just like, nah. Yeah. But Kim does say that he remembers it differently. He says that Michael told him it didn't seem like a good fit for his clients, but that they talked on and off about it for a while. Either way, Kim goes right back to raising funds.

In all, he brings in more than $140 million. But other investors aren't so willing to put their heads in the sand. Fast forward about three years to January 2019. Michael gets a call from a private equity firm. They tell him they're about to invest $100 million into a fund run by a woman named Gina Champion Kane. But they want Michael to help them make sure it's legit. Michael must be shocked to discover that Gina's scam is still thriving.

He drives to the firm's office and looks at the documents. He points out some issues right away. Gina's company makes it sound like the state requires the full cost of the liquor license be paid up front when he knows this isn't how things really work. Plus, he thinks the licenses' Gina lists are way too expensive. The investors ask Michael what he recommends. He has a master's degree in accounting and used to be an auditor. So, he gives them a game plan.

He tells them to call every other liquor license broker and ask if they've worked with Gina. And none of them have. Then, Michael gives the investors a big stack of paperwork, copies of every recorded notice that's been filed in the last six months. A recorded notice is filed when the liquor license is being transferred and it lists the buyer, the seller, and the escrow company used to complete the deal. Michael tells them to see which ones used Chicago title and then call the buyer and ask if they use Gina's service.

Not a single one said yes. Not only that, when the investors run the numbers, they realize that the last six months of deals only add up to around $15 million. Gina claims that her program alone made $60 million in loans over that period. After Michael's investigation, the private equity firm has to admit that Gina's investment opportunity sure looks like a Ponzi scheme. So far, Gina's gotten by on people

blinded by good returns and her winning smile. But her years long con is about to go up and flames. in flames. Two months after Michael helps expose Gina's con, she's sitting on the patio of her vacation home in Carmel, California. As she looks out at the Pacific, she sips a glass of Cabernet Sauvignon. In her memoir, Gina says that when her assistant calls her to say she got a letter from the SEC,

Gina decides to ignore it. She'll get to it in Monday, but then, him texts her. When Gina calls him, he says, I just got a subpoena from the SEC. What the fuck is going on?" He thinks it's a misunderstanding. The subpoenas don't accuse him and Gina of anything. They just request documents. But Chicago title is subpoenaed too. Gina says she knew it was the beginning

of the end. So she responds with two girlboss poise and restrained. Just kidding, she panics and tells her employees to delete emails and alter accounting records to hide the fact that she's been spending money on whatever she wants. But obviously, none of that can stop what's coming. The SEC officially charges Gina with securities fraud three months later. They freeze her assets and they find out that of the more than $300 million

that has passed through her escrow account, just about $11 million remains. Gina knows she's in hot water. So she agrees to work with the SEC. She's done, she'll talk. But then she finds out the FBI is also looking into her Ponzi scheme. She tries to delete all the information off her computer and erase the video evidence from

her home security system. The FBI finds out, duh, and tax on obstruction of justice onto her charges. Gina's liquor license empire has fallen. But while she admits the scam is over, she still finds a way to be the protagonist of her story, till the bitter end. In March of 2021, Gina's friend Jane goes to the federal court house in downtown San Diego. It's just six blocks away from the house of blues, Regina kickstarted her career of making shit up.

During the hearing, the government says Gina, quote, put Ponzi on steroids. All told, she convinced nearly 500 investors to pump $372 million into her scheme. The government estimates that Gina pocketed more than $150 million of that for herself and her business. On top of that, she spent $800,000 on box seats at Chargers and Padres games, more than $200,000 in jewelry from places like Tiffany's and $60 million to prop up her various businesses, most of which never came close to being successful on their own. Gina says she's truly sorry, but then Jane steps up to speak on the record. She was one of the first investors in this game, and after she and her wife retired, they gave Gina even more money.

Jane's stunned by Gina's betrayal. She says to take advantage of your friends and to perpetuate the lie over and over, I still don't understand. Sachi, can you read some more of what she tells a court? Yeah, she said, I came here wanting to, you know, punch Gina in the face, but I'm listening to her

and part of me wants to give her a hug because I feel awful that here's where we are at a sentencing hearing where my friend is facing double digits in federal prison. That's really generous. I would not feel that way and I don't think a lot of people would. I straight up would go to punch Gina in the face. I think it's like almost the coldest thing you could say to someone is like, my anger towards you means nothing because you might be going to jail for decades. Yeah, I actually just pity you.

Well, other people who choose to speak are less kind. One calls Gina evil. No one speaks in her defense. The judge also can't help but notice that Gina seems like a real dick. He says he didn't fully realize that she had personal relationships with so many of the victims, and that the level of deceit and betrayal is shocking. So he sentences Gina to 15 years in federal prison,

four more years in prosecutors recommended. Chicago title Fires Della and Betty. They're named in several of the dozen lawsuits investors file against the company. The lawsuits point to emails between Gina, Della, and Betty, and all the gifts Gina provided them, alleging that they must have been involved. The lawsuits have been settled with Chicago title

not admitting any fault, but giving the majority of investors their money back. Kim, who helped raise $140 million from various investors over the course of the scheme, says he always thought it was a legitimate loan program. He's never been charged with a crime. When the government announced their plan to pay victims back after selling off Gina's assets, they decided not to give Kim anything.

Steve and Gina split up a year after the sentencing hearing right around their 32nd wedding anniversary. Gina has always maintained that Steve wasn't a dark about her scheme. And once she was in jail, he was left with nothing but a refinanced home, a bunch of golden retrievers,

and a lifetime's worth of questions. Gina's serving her time in the same prison where Felicity Huffman and Lori Loughlin went for the college admission scandal. She's talked to friends about plans to sell the rights to a movie about her life. She apparently told a friend that Netflix or Amazon would pay millions for her story. Nothing, not even a jail cell cell can house Gina's raw ambition. Sachi, it felt like she was playing kind of like a board game with the city of San Diego. Yeah.

So maybe that monopoly cover story was a bit prophetic, you know? Yeah, she's an interesting scam artist. I mean, she leaned into the charm. Like I get it. Yeah, I feel like she did something that a lot of the female scammers we have on the show can't really do, which is to be charming enough that no one asks any questions or really

even outwardly hates you. Like, she was dealing with investors who had a lot of money. And I feel like it just showed me that in the circle of rich people, there's just like this level of trust and solidarity where they're just like, yeah, I won't ask any more questions

because even if you think about it, it would be really crazy that the government would just expect businesses to give $100,000 up front for a license. Like that isn't really something that makes sense for a city. I think there was probably a huge element of people didn't want to question her because she was speaking the words of a movement, and so people don't want to be seen

as criticizing that. And I think also nobody wanted to go after a young, attractive woman in a space that doesn't have a lot of women in them period. I think she really used that to her advantage. Oh yeah, again, like there is something kind of charming that all of her communication is like, look at these dumb men, they don't understand anything, but I do, like I get that, that's enticing.

For women you see it and it's like comforting and encouraging to feel like, oh, there's a woman here, She will tell me the truth. She will take care of me. And for men, they just are underestimating her. And so nobody's asking any of the questions that maybe they should be. She also did something which I think is like the opposite of a lot of that traditional business advice for women. She was like, hey, wait a second. Like, these men want my cookies. I'm going to use that to my advantage, rather than being like, I'm more than just my cookies, you know?

Yeah, I mean, I think she saw people didn't respect her out of the gate, and she used it. And that, I think, is true and impressive. The fraud itself, I don't love. So I think the lesson here is, if you got cookies to bake, bake them. Yeah, I'm gonna show up to things with freshly baked cookies and shaved legs. Hey, prime members, you can listen to scamful answers, add free on Amazon music. Download the Amazon music app today, or you can listen

add free with Wendry Plus and Apple podcasts. Before you go, tell us about yourself by completing a short survey at Wendry.com slash survey. This is Live Laugh Live. I'm Sarah Haggi and I'm Sachi Kohl. If you have a tip for us on a story that you think we should cover, please email us at scamfulensorsatwondery.com. We use many sources in our research. A few that were particularly helpful were the charismatic developer and the Ponzi scheme that suckered San Diego by Chris Pymorski for Bloomberg,

Lori Weisberg and Greg Moran's reporting for the San Diego Union Tribune. And I did it by Neil Centuria and his wife and co-author Barbara Breed. Sarah Anya wrote this episode, additional writing by us, Saty Cole and Sarah Hagi. Our senior producer is Jen Swan. Our producer is John Reed. Our associate producers are Charlotte Miller

and Lexi Peere. Our story editor and producer is Sarah Any. Our story editor is Eric Thurm. Sound Design is by James Morgan. Back checking by Will Tapplin. Additional audio assistance provided by Adrian Tapia. Our music supervisor is Scott Velasquez for Freeson Sink. Our senior managing producer is Ryan Lawre. Our managing producer is Matt Gantt. Our coordinating producer is Desi Blaylock.

Kate Young and Olivia Rashard are our series producers. Our senior story editor is Rachel B. Doyle. Our senior producer is Ginny Bloom. Our executive producers are Janine Cornelow, Stephanie Gens, Jenny Lauer Beckman and Marshall Lui for Wundery.