JACKSONVILLE, Fla. -- Thursday a federal judge sentenced 67-year-old Lydia Cladek to 30 years and 4 months in federal prison.
Cladek was found guilty in January of conspiracy to commit mail and wire fraud, according to a news release from U.S. Attorney Robert O'Neill. In addition to the prison term, Cladek will have to pay more than $34 million in restitution.
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O'Neill said testimony and evidence presented at trial showed Cladek offered investors the chance to loan money to Lydia Cladek, Inc., in exchange for a promissory note from the corporation. These notes were car notes secured by Lydia Cladek, Inc., that she had purchased in the past.
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Cladek would then present the notes as genuine and valid, O'Neill said, but the notes had never been assigned before and would not in the future.
Cladek also told investors she would take the funds to purchase new car notes. O'Neill said all of those representations were untrue. Some of the car notes had been assigned to as many as four and five investors. Some of the car notes would then be assigned to new victim investors. In some cases the notes were assigned to multiple investors in the same week.
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Once she had the investors' money, Cladek would use the funds to pay interest to old investors and to fund her lifestyle. O'Neill said Cladek owned three vacation homes.
March 31, 2010, O'Neill said Cladek's existing performing car notes had decreased in value to under $4 million and the outstanding loans to investors exceeded $90 million.
The FBI with the assistance of the Federal Department of Insurance Fraud investigated the case against Cladek.
First Coast News