Nashville Woman Sentenced To Federal Prison For Ponzi Scheme
For Immediate Release
U.S. Attorney's Office, Middle District of Tennessee
NASHVILLE – A Nashville woman who bilked investors by claiming that her sports marketing agency represented famous athletes was sentenced yesterday to 70 months in federal prison, announced U.S. Attorney Henry C. Leventis for the Middle District of Tennessee.
Katie Lynn Mancuso, 41, who owned Gray Area Marketing in Nashville, was initially charged in September 2021 with bank fraud and wire fraud after operating a fraudulent scheme in which she received $2.8 million from investors. Beginning in 2017, Mancuso solicited funds from investors and falsely represented that her agency had been awarded contracts to perform marketing services for professional athletes. Mancuso overstated Gray Area’s assets and receivables and promised to repay investor’s funds within 90 days and with a rate of return usually between 15%-25%. Mancuso also provided investors with fake invoices and emails to make her business appear legitimate, including invoices falsely reflecting money owed to Gray Area by vendors such as Nike, Oakley, and Under Armour for services rendered.
Mancuso also forged the signature of an attorney on a fraudulent attorney-client representation and forged the signatures of another individual on a purported contract. Between June 2017 and February 2021, Mancuso solicited funds from at least 26 investors. Although she repaid some investors, using funds from others, the total loss to investors was more than $1.1 million. Mancuso used the investment funds to pay her living expenses and at hotels, bars, and to obtain plastic surgery.
Mancuso pleaded guilty to the charges in October 2021. However, prior to her scheduled sentencing in August 2022, she continued to commit fraud and submitted false documents to the Court in support of her sentencing request. The Court later revoked Mancuso’s pre-trial release status and remanded her to federal custody.
U.S. District Judge William L. Campbell, Jr., also ordered Mancuso to pay $1,011,241.33 in restitution and spend a term of four years of supervised release at the conclusion of her prison term.
This case was investigated by the FBI. Assistant U.S. Attorney Kathryn W. Booth prosecuted the case.
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Public Affairs Officer
Updated January 25, 2023