INDIANAPOLIS – A former Lebanon insurance broker accused of bilking millions from people in a “Ponzi-like” scheme will plead guilty in the federal case against him.
Brian Simms was set to go on trial March 4. The trial date is vacated after he and the state worked out a plea agreement. As part of the deal, Simms will plead guilty to one count of wire fraud; the state will drop the five other wire fraud counts against him.
According to court documents, the potential maximum penalty is 20 years in federal prison, a $250,000 fine and three years of supervised release.
Federal prosecutors announced charges against Simms in September 2022.
Simms ran Brendanwood Financial Brokerage LLC in Carmel. And while he was a licensed insurance broker, he was not licensed to sell securities or registered to provide financial advising services, investigators said.
Through his company, he convinced 20 people to liquidate their investments—401(k) accounts, annuities and the like—and give his company their money to reinvest it.
The amounts contributed by the victims ranged between $15,000 and $1.4 million, according to court documents. But Simms didn’t make good on these promises to invest the money. Instead, he used it to cover payroll and personal expenses.
Some of those personal expenditures included “payments to credit cards, Amazon, grocery stores, gasoline, restaurants and utilities,” according to court documents.
Simms was aware he was “not authorized to use the Victim Investors’ funds for business expenses at Brendanwood and for his own personal expenditures.”
To keep up the charade, he provided falsified financial statements showing the victims where their money went. Federal prosecutors said he redistributed money he’d collected to some of the victims by making “Ponzi-type payments” from funds he’d taken from others.
To the victims, it appeared their money went toward legitimate investment channels and provided an increased rate of return. However, Simms “never invested the funds and either created or directed others to create the falsified reports,” according to court documents.
Simms ran the scheme between 2013 and 2021.
The plea agreement indicated Simms agreed to pay more than $2.62 million in restitution to the victims. A sentencing date has not been set.
Comments are closed.