Onetime Rittenhouse Square resident Brenda Smith, who promised double-digit gains for her well-heeled investors, on Thursday admitted to orchestrating a $100 million securities fraud.

Smith, 61, who was living in a penthouse apartment in Center City at the time of her 2019 arrest, pleaded guilty by video-conference before U.S. District Judge Madeline Cox Arleo to an indictment charging her essentially with stealing clients’ money. The count to which Smith pleaded guilty carries a maximum penalty of 20 years in prison and a $5 million fine.

Smith founded Broad Reach Capital, an investment hedge fund, in early 2016 and sought out wealthy investors, asking for a minimum investment of $1 million, according to documents filed in the federal case.

Until the summer of 2019, Smith raised $100 million from about 40 investors, promising to invest funds in sophisticated trading strategies. Instead, two thirds of the money disappeared.

So far, a receiver in the case has about $7 million in cash and is attempting to recover more from early investors. The receiver is also selling Smith’s assets, including valuable rugs from her former apartment, her Infiniti car, four properties she owned in her home state of Louisiana, and more than 30,000 shares in the Lyft ridesharing company. Such a stake in Lyft was worth more than $1.5 million at closing prices Thursday.

» READ MORE: How alleged Ponzi hedge funder Brenda Smith fell from grace — and her Rittenhouse Square penthouse — to a N.J. jail.

Smith’s biggest investor was Surefire Dividend Capital, a Montreal investment firm that reported losing $46 million. The firm sued Smith in September 2019, as did the U.S. Securities and Exchange Commission’s Philadelphia regional office.

As part of her plea agreement, Smith agreed to make full restitution to all of her victims. She remains in Essex County jail until her sentencing, scheduled for Jan. 20 in federal court in Newark.

Over the course of the fraud, she transferred tens of millions of dollars from Broad Reach Capital, prosecutors say, including $2 million to pay her own American Express charges. As her scheme began to fall apart and investors wanted to redeem their money and cash out, Smith made excuses and diverted other investors’ funds to pay the redemptions, records show.

After her diversions of money, prosecutors said, her bank and brokerage accounts at their peak held no more than $32 million.

Smith had touted Broad Reach Capital’s performance, saying it had posted a 33% returns in 2017 and made more money in 2018. In fact, the value of Broad Reach’s account had fallen.

To lull investors into handing over more money, Smith mocked up monthly account statements for them that falsely claimed significant returns, prosecutors said. Smith also lied in saying she was putting her own money into Broad Reach.

Smith’s offices were located in 200 Four Falls Corporate Center in West Conshohocken.

Smith targeted a who’s who of prominent Philadelphians in her fraud. She compiled a “rich list” of wealthy people on an Excel spreadsheet, with columns recording how much money might flow in from them and her progress in nailing down an investment. Though Smith never met most of her targets, she would drop names to open doors, said one banker who later heard — to his surprise — that he was being touted as an interested investor.

Federal prosecutors also charged Brenda Smith’s longtime associate George Heckler, whose hedge funds Cassatt Short-Term Trading and CV Fund were clients of the accounting firm where Smith worked. He was sentenced in a separate fraud earlier this year to five years in prison.

The receiver in the Smith civil case, Kevin Kent, of the Conrad O’Brien law firm in Philadelphia, filed a report this summer saying he was still untangling the complex fraud. To date, Kent’s accountants have identified more than 80 bank accounts controlled by Smith for 60 entities between 2007 and 2019.

Any creditors or victims of Smith’s theft can contact the receiver at http://broadreachreceiver.com/index.html. Kent is developing a claims procedure.

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