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Date: 06-28-2019
Case Style:
United States of America v. Dennis Gibb
Case Number: 2:19-cr-00059-RSM
Judge: Ricardo S. Martinez
Court: United States District Court for the Western District of Washington (King County)
Plaintiff's Attorney: Matthew Diggs and Michelle Jensen
Defendant's Attorney: Michael D. McKay
Description:
Seattle, WA - Long-Time Redmond, Washington Investment Advisor Sentenced to Prison for Defrauding Investors of more than $3 Million
Falsified Financial Statements – Used Investor Money for Own Expenses
A long-time investment advisor in Redmond, Washington was sentenced today in U.S. District Court in Seattle to five years in prison for defrauding more than 15 investors of more than $3 million, announced U.S. Attorney Brian T. Moran. DENNIS GIBB, 72, the President and owner of Sweetwater Investments Inc., pleaded guilty in March 2019, to wire fraud and falsification of records with the intent to obstruct a matter within the jurisdiction of the Securities and Exchange Commission (SEC). Simultaneously, GIBB and Sweetwater investment entered into a consent decree with the SEC liquidating the Sweetwater Income Flood LP Fund and barring GIBB from further investment activity. At the sentencing hearing, Chief U.S. District Judge Ricardo S. Martinez said GIBB “entered into a scheme and deliberately, intentionally and knowingly stole money from people who came to him…. Many victims, late in their lives, entrusting him with money they intended to get them through the last years of their lives.”
“Those who invested with this defendant were not looking for the ridiculously large profits promised by some Ponzi schemers – they invested with the defendant because he promised them a secure, if modest, payout,” said U.S. Attorney Brian T. Moran. “Instead, over more than a decade this defendant stole their savings, retirement funds, future home down payments, and children’s education funds. To make matters worse, he provided victims with false tax documents, causing some to pay additional taxes on non-existent gains. This defendant not only robbed the victims financially, he stole their peace of mind and their trust.”
According to the criminal case filings and the SEC consent decree, GIBB created Sweetwater Income Flood Limited Partnership, a private fund Gibb managed, in 2008. As early as 2007, he began soliciting investors for the fund targeting those who wanted steady retirement income in the near future. Between 2007 and 2018, about 25 investors put about $7.3 million into the fund. GIBB secretly transferred more than $3.1 million from the fund for his own expenses. To hide his theft, GIBB sent investors falsified quarterly account statements. When the SEC began an examination of the Sweetwater Investments in May 2018, GIBB provided false records to examiners indicating the fund had been liquidated.
GIBB agreed to forfeit a money judgment of $3,197,401. The Court also ordered restitution of $4,233,616. This amount includes approximately $1.77 million that remained in the Income Flood fund at the time of Gibb’s consent decree and guilty plea. Gibb agreed to turn these funds over to the SEC for disbursement to victims, and the funds will be disbursed as part of the restitution order.
The case was investigated by the SEC and the FBI.
Charges:
Wire Fraud - 18:1343
(1)
Falsification of Records in Connection with SEC Examination - 18:1519
(2)
Outcome: Defendant was sentenced to 60 months custody; 3 years supervised release with conditions set forth in judgment form; fine waived; $4,233,616.75 restitution; $200 special assessment.
06/28/2019 25 Minute Entry for proceedings held before Judge Ricardo S. Martinez- CRD: Lowell Williams; AUSA: Matthew Diggs; Def Cnsl: Michael McKay, Brian Peterson; USPO: Amelia Whaley; Court Reporter: Nickie Drury; Time of Hearing: 11:30 AM; SENTENCING held on 6/28/2019 for Dennis Gibb (1). After hearing from counsel, two victims (by videoconference) and the defendant, the Court imposes the following sentence as to Counts 1-2: 60 months custody; 3 years supervised release with conditions set forth in judgment form; fine waived; $4,233,616.75 restitution; $200 special assessment. At dft's request, Court recommends placement at FCI Sheridan or Terminal Island. Dft remanded to custody. (LW) (Entered: 06/28/2019)
06/28/2019 26 JUDGMENT as to Dennis Gibb by Judge Ricardo S. Martinez. (cc: USPO, PTS, FLU, Fin., USMO, Sea Tac Det) (LW) (Entered: 06/28/2019)
Plaintiff's Experts:
Defendant's Experts:
Comments: