FOR IMMEDIATE RELEASE
July 25, 2007  

WWW.USDOJ.GOV/USAO/CAN                                       Natalya.LaBauve@usdoj.gov 

FORMER LOS GATOS RESIDENT SENTENCED TO 27 MONTHS IMPRISONMENT FOR ROLE IN $6.5 MILLION INVESTMENT SCHEME

Used Investor Funds To Pay For Trips, Gifts, Luxury Automobiles

SAN JOSE- United States Attorney Scott N. Schools announced that Patricia Nolan, 61, a former resident of Los Gatos, was sentenced Monday, July 23, 2007 to 27 months in prison for her involvement in a $6.5 million fraudulent investment scheme. This sentence is the result of a two-year investigation by agents of the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation Division.

Ms. Nolan pleaded guilty on December 5, 2005 to a count of mail fraud, in violation of 18 U.S.C. § 1341. According to the plea agreement, Ms. Nolan admitted that she participated in an investment scheme whereby she solicited people to invest money in a purported investment program called the Nations Program, which was later known as the Malibu Trust. Nolan admitted to knowingly making numerous false representations to potential investors about how the money invested in the scheme would be used, including representing that the monies invested would be used to fund development projects in Third World nations, and representing that the monies were invested in international currency trading. Nolan further falsely represented to investors that they would receive a significant return on their investment in a short period of time. Based upon Nolan's false representations, investors wired money directly to Nolan in bank accounts over which she had control.

Nolan admitted in her plea agreement that the representations regarding the investment of money in Third World countries and international currency trading were false. Nolan knew that these representations were false at the time she made them, and she made them with the intent to defraud potential investors into sending money. When Nolan received these funds, she did not invest them in any of the above-described programs; instead, she diverted the money for her own use, spending the money on luxury automobiles, using the money for travel, and purchasing gifts for family and friends. When individual investors complained, Nolan sent investors update letters which she knew contained false information regarding the status of their investments. The purpose of these letters was to deceive the investors into believing that the return on their investments would be forthcoming. The sentence was handed down by U.S. District Court Judge Ronald M. Whyte following Ms. Nolan's guilty plea to a count of mail fraud, in violation of 18 U.S.C. § 1341. Judge Whyte also sentenced the defendant to a term of three years supervised release and ordered her to pay $1,840,469 in restitution. The defendant will begin serving the sentence in September 2007.

Jeff Nedrow is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Susan Kreider. The prosecution is the result of a two-year investigation by the San Francisco Office of the Federal Bureau of Investigation, and the Internal Revenue Service-Criminal Investigation Division.

Further Information:

Case #:CR 99-20176-RMW
A copy of this press release may be found on the U.S. Attorney's Office's website at www.usdoj.gov/usao/can.

Electronic court filings and further procedural and docket information are available at https://ecf.cand.uscourts.gov/cgi-bin/login.pl.

Judges' calendars with schedules for upcoming court hearings can be viewed on the court's website at www.cand.uscourts.gov.

All press inquiries to the U.S. Attorney's Office should be directed to Natalya LaBauve at (415) 436-7055 or by email at Natalya.LaBauve@usdoj.gov.

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