A pharmacist has been sentenced to more than 11 years in prison after she orchestrated a Ponzi scheme which targeted family members and local residents
Natalie P. Cochran, a former pharmacist from Raleigh County, West Virginia, was sentenced to 135 months in federal prison for her role in the scheme, which cost her victims more than US$2 million (AUD$2.6 million).
She had pleaded guilty to wire fraud and money laundering charges in September 2020.
The pharmacist reportedly used the fraudulently obtained funds to make a number of significant purchases, including a 1965 Shelby Cobra, two pieces of real estate, jewellery and multiple other vehicles.
She has also been ordered to pay back more than US$2.5 million (AUD$3.24 million) in restitution to her victims, and serve a further three years of supervised release. She has also forfeited her interest in the assets she obtained through her fraudulent activities.
According to a statement from the US Department of Justice, US Attorney’s Office, Southern District of West Virginia, Dr Cochran had convinced at least 11 people to invest in the scheme, including at least one person she knew experienced a financial hardship as a result.
And according to West Virginia’s Register-Herald, her victims included her late husband’s mother and stepfather, Donna and Eddie Bolt, whose life savings she had taken.
Reporter Jessica Farrish writes that the pair had asked the judge, Frank Volk, to impose the harshest possible sentence on their daughter-in-law.
The Register-Herald reported that she had blamed the fraud on her late husband, saying he was abusing steroids and had committed a number of acts of domestic violence, including attempting to run her over with his car, and smashing furniture with a sledgehammer.
She said that she had never disclosed this alleged abuse to anyone else, to protect him.
She said that she had needed money to keep him happy, and that most of the goods forfeited to the US government had been his “toys”.
However his parents denied this.
The couple had invested their “nest egg” of nearly US$250,000 (AUD$324,685) into Dr Cochrane’s business, and had never seen the returns on investment she had promised. The two are now surviving on welfare benefits and disability payments.
Ms Bolt said that at one point, Dr Cochrane had also told them she had cancer, and then that it had “left” after the Bolts and members of their church community prayed for her. Mr Bolt said he now believed the former pharmacist had never had the disease.
They also told the Court that Dr Cochrane had awarded fake scholarships to high school students – some of whom had turned down real scholarships so that they could receive false ones from Dr Cochrane.
The scheme had involved two entities owned by Dr Cochrane, Technology Management Services and Tactical Solutions Group.
Between around June 2017 to August 2019, she persuaded her victims to invest in the businesses and in fake government contracts by making “false misrepresentations regarding her and her companies’ experience and purported success as government contractors,” the Department of Justice said.
One investor had been persuaded to send her more than half a million dollars.
Another investor, a local orthodontist, had sent her $50,000 during a negotiation to sell the two businesses after Michael Cochran died in 2019. Dr Cochran had produced “extensive” false documents, Ms Farrish writes, to convince him to pay more than $4 million for the two entities.
Two more victims had invested in order to give them financial breathing room to care for seriously ill children, including one woman who was sent two cheques by Dr Cochran – both of which bounced.
Dr Cochran’s own sister was also a victim, and their parents eventually had to sell their own home to move in with the sister after she lost money to the fraud.
A criminal investigation into Michael Cochran’s death is ongoing, the Register-Herald reports.
Judge Volk called the offending “unusually sinister” and “one of the most complex and practiced frauds the Court has seen”.
“Today’s sentencing recognizes the importance of holding the defendant responsible for lying to a financial institution and investors, and fraudulently inducing them to finance her companies and fake government contracts,” said FDIC Inspector General Jay N. Lerner.
“The defendant then, in turn, purchased luxury items for her personal use with the illicit proceeds. The FDIC Office of Inspector General remains committed to working with the U.S. Attorney and our law enforcement partners to bring to justice those who commit such flagrant offenses, and to help preserve the integrity of the banking sector.”