Woman Who Ran "Classic Con" That Duped Investors of $1.4 Million Sentenced

AUSTIN, TEXAS

Sam_Sparks_District_Judge — U.S. District Judge Sam Sparks

A federal judge sentenced 63-year-old Rose Marie O’Reilly, of La Grange, TX, to four years in federal prison for running a con that duped investors out of $1.4 million.

In addition to the prison term, U.S. District Judge Sam Sparks ordered that O’Reilly pay $1.4 million as restitution.

“O’Reilly ran a classic con with a dazzling twist–offering the allure of collectible silver antiques and pink diamonds. Like all Ponzi schemes, at its core was a simple scheme to defraud investors and use their money for her own gain,” said U.S. Attorney Richard L. Durbin, Jr.

On Sept. 23, 2015, O’Reilly pleaded guilty to one count of money laundering.

O’Reilly admitted that from August 2007 to August 2012, she stole money from investors through an antiques and jewelry acquisition scheme and engaged in monetary transactions with criminally derived property, officials said.

According to court documents, O’Reilly convinced investors that various antiques and jewelry items purchased with their investment funds could be resold for profit.

Some of the antiques and jewelry pieces in her scheme included the Spratling Silver Banquet Set purportedly commissioned by deceased Country and Western singer Marty Robbins.

O’Reilly convinced investors that once the “lost” pieces were reunited with the set, they could then sell the complete collection for the anticipated price of $21 million, according to authorities.

O’Reilly also convinced investors that she could acquire, and then resell for profit, an assortment of pink diamond jewelry formerly owned by alleged New Orleans mob boss Carlos Macello, officials said.

“The FBI will continue to vigorously pursue scam artists, like the defendant, who convince others to entrust them with their hard-earned money, but instead use that money for personal gain,” said FBI Special Agent in Charge Christopher Combs. “This sentence ensures that Mrs. O’Reilly is punished and sends the strong message that investment schemes don’t pay.”

“The role of IRS Criminal Investigation becomes even more important in Ponzi scheme investigations such as this due to the complex financial transactions that must be unraveled. Honest and law abiding citizens are fed up with greedy individuals, such as Ms. O’Reilly, who abuse the trust they are granted and use deceit and fraud to line their pockets with other people’s money,” said IRS Criminal Investigation Special Agent in Charge William Cotter. “Today’s sentencing demonstrates the serious consequences of financial crimes such as this and the collective focus of IRS-CI and our partners to holding the perpetrators of such nefarious investment schemes accountable for their actions.”