A Columbia Falls woman will admit later this month that she operated a Ponzi scheme that took more than $1.5 million from 28 different investors.
Catherine Ann Finberg is set to appear at a change of plea hearing on Jan. 25 in Flathead County District Court.
According to a plea agreement signed on Dec. 28 and filed in court records last week, Finberg will plead no contest to theft by embezzlement and guilty to operating a pyramid scheme and two counts of fraudulent securities practices, all felonies. Prosecutors have agreed to drop the charge of failure to register as a securities broker.
Prosecutors are expected to recommend that Judge Amy Eddy sentence Finberg to 40 years in the Montana State Prison with 30 years suspended.
Last year, Finberg’s investment accounts were frozen at the request of attorneys with the Montana Commissioner of Securities and Insurance who were investigating the Columbia Falls woman. Although Finberg had not been charged yet, the attorneys believed they had enough evidence of illegal activity and wanted to stop her before she harmed anyone else.
“Given Finberg’s recent and continual activities involving these accounts, failure to freeze them could result in continuing, immediate, and irreparable injury to the investors by depriving them of sources from which to recover their investment funds,” attorneys wrote in an affidavit supporting the restraining order.
A Ponzi scheme involves a person paying investors using money obtained from later investors, rather than from any profits earned.
According to court documents, between 2008 and 2016, Finberg, who has served as an assistant coach for the Columbia Falls High School girls basketball team, took at least $1.5 million from 28 different people, who expected her to invest the funds on their behalf. According to charging documents, at least four of those investors were “vulnerable persons” because of their advanced age and one was mentally disabled.
Last summer, Finberg was charged with five felonies stemming from the Ponzi scheme. She pleaded not guilty to all charges in September.