Chevy Chase Woman Accused of Running Ponzi Scheme Through Luxury Sportswear Website
Former radio show host might have tried to cast spells on attorneys investigating her
Dawn Bennett, a Chevy Chase resident and former radio show host, is accused of an ongoing Ponzi scheme targeting elderly or uninformed investors.
A Chevy Chase woman is accused of defrauding people out of millions of dollars through a luxury sportswear website, a scheme that authorities said ended Friday when the FBI arrested her in New Mexico.
A chronology of the case includes allegations of extravagant spending by Dawn J. Bennett and her attempts to cast spells on authorities who were pursuing her.
Bennett, a 55-year-old former financial radio show host, faces prosecution from both the U.S. Department of Justice and the U.S. Securities and Exchange Commission in what was described as a Ponzi scheme.
Over the course of two and a half years, Bennett allegedly took in more than $20 million from dozens of investors for her company DJBennett, which sells luxury apparel online for biking, tennis, scuba diving and other activities.
Instead of putting the investments toward the business, Bennett reportedly used much of the investments to pay back earlier investors and make purchases to support an extravagant lifestyle, according to charging documents.
Her alleged purchases included jewelry, clothing, payments on a mortgage on a Chevy Chase penthouse condo and a $500,000 annual 20-year lease for a suite at A&T Stadium, home of the Dallas Cowboys. She also spent money on mystics and $29,715 on astrological gems, documents claim.
Bennett could not immediately reached for comment by phone or email Tuesday evening.
Bennett formerly hosted the radio show “Financial Myth Busting with Dawn Bennett” and ran a financial advice business in Washington, D.C. In recent years, Bennett apparently lost clients and her personal finances began to deteriorate.
The SEC claims Bennett would largely target elderly and financially unsophisticated people, promising them 15 percent annual returns and misleading them about the financial risk involved.
Starting in December 2014, investors, many from Maryland and Virginia, would wire her hundreds of thousands of dollars. When investors or lenders pressed her for returns or asked for their money back, Bennett sometimes claimed to be out of the country or have limited access to email.
Bennett allegedly also attempted to pay them by inflating her net worth to take out loans, charging documents say. In one instance, she had an employee apply for a $750,000 line of credit for her apparel company by listing a portfolio value of $4 million, according to the Justice Department. In reality, the account had $35.
When the lender declared the loan in default, Bennett responded that she wasn’t aware and had been in China for eight months—though her credit card purchases showed transactions in Chevy Chase and D.C.
As investigators closed in, Bennett urged an employee in emails to “Be nice but be incompetent” when talking to authorities about her, according to the Justice Department’s affidavit.
On Aug. 2, FBI agents searched her Chevy Chase condo and D.C. office and allegedly found evidence of Bennett’s financial misconduct. They also located luxury items like rows of shoes and found instructions for putting people under a “Beef Tongue Shut Up Hoodoo Spell”—a “voodoo spell” intended to keep people from talking about her.
Top: Shelves of shoes found in Bennett's condo; below: Mason jars bearing the initials of SEC attorneys. Via Department of Justice
“I cross and cover you[,] come under my command[,] I command you to hold your tongue,” the “spell” read, according to the affidavit.
The agents found biographical information for three SEC attorneys investigating Bennett and dozens of Mason jars with their initials on her freezer, which, the affidavit states, indicates she had “many times cast a 'hoodoo spell' in hopes of paranormally silencing” them.
The FBI arrested Bennett in Sante Fe, and she has since been released on a $5 million bond, though she is not allowed to leave her home unless for court-approved reasons.
She faces charges of wire fraud, bank fraud and making false statements for loan and credit card applications, as well as violations of federal securities law. She is set to appear in the United States District Court in Greenbelt.