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January 10, 2006Two plead guilty in investment scamThey have 11 months to make restitutionTRAVERSE CITY - The former owners of a Traverse City investment firm have admitted to cheating clients into investing over $1 million in a "Ponzi" scheme.Gary Singer and Margaret Zimmerman, owners of Estate Growth Management, formally pleaded guilty to charges they used false pretenses to lure investors into investment schemes. The deal reached with the state attorney general's office, which charged Singer, Zimmerman and their company with 25 felony counts in July, will allow the pair 11 months to make restitution before they are sentenced. Company president Singer, 54, admitted to 13th Circuit Court Judge Philip Rodgers that he promised investors a 12-percent return on their investments in the California-based Network Services Depot, but failed to disclose penalties and other commissions. Singer pleaded guilty to two counts of false pretenses over $20,000, while Zimmerman admitted to two counts of embezzlement, both over $20,000, as part of the deal. The felonies are punishable by up to 10 years in prison. Singer and Zimmerman - who agreed to surrender their insurance licenses - also cut a check for $200,000 last week as part of a restitution agreement. The deal will delay sentencing for 11 months to allow Singer and Zimmerman to make restitution and cooperate with investigators. During that time, if Zimmerman and Singer, along with others found responsible, repay victims $705,624, they will be allowed to substitute a plea of attempted embezzlement and false pretenses, which carries a five-year maximum in prison. If Zimmerman and Singer are only able to pay back $100,000 during the 11 months, each will be allowed to drop one of the 10-year charges, according to the deal. See Related Stories:
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