Spokane businessman wins new trial in lottery winnings fraud case

A Spokane man facing a charge of wire fraud after promising investment returns to a widowed Oregon lottery winner has received a new trial.

Scott K. Brett had his request to withdraw a guilty plea to the federal charge granted by U.S. District Court Judge Salvador Mendoza in November, according to court records. A grand jury charged Brett with making false promises to a woman who gave him $1 million to invest in February 2011, which Brett promised he could turn into $8 million over the course of several weeks.

Instead, the money was taken out of an escrow account and transferred to the care of an attorney and other bank accounts Brett owned, according to a grand jury’s indictment. Only $145,000 of the original $1 million investment was returned to the investor, who is not named in court records.

After initially entering a plea of guilty to Mendoza in a Richland courtroom in January 2017, Brett has retained new counsel. He argued in legal filings that he had no intent to defraud the alleged victim, who won $18.2 million playing the lottery with her late husband in 2003, according to court records.

“He helped make the investments, and those investments turned out to be bad,” said Scott W. Johnson, a Richland-based attorney who is now handling Brett’s case. “He never took the money with the intent to have these investments go bad.”

Brett argued that his previous attorney, Roger Peven, didn’t conduct interviews with others involved in the investment scheme before pushing for a guilty plea during the hearing last January. He also told Mendoza a forensic accountant should have been hired in the case to provide evidence that would help his defense.

Mendoza, granting the request to withdraw that guilty plea that would have sent Brett to prison for up to four years, ruled that Brett was not fully advised about the evidence against him before entering the plea and thus eligible to request a new trial.

Peven, reached by phone Wednesday, said he didn’t have anything to add to the court’s record of the case.

A new trial date is scheduled for May in Richland. Brett is not in custody.

Before the alleged lottery investment scheme, Brett had been involved in several business dealings from his home on the Five Mile Prairie in Spokane. He made a bid in 1998 to purchase a little more than 50 acres of land in north Spokane to protect it from subdivision development, but the deal fell through.

In 2009, city officials from a Nashville, Tennessee, suburb traveled to Spokane to check up on a “green technology” firm that listed Brett as its chief executive officer, according to local media reports at the time. The company, CoreTech Industries, was based in Canada with a license out of Nevada and had been ordered to pay $185,000 to creditors as part of a judgment against the firm by the Spokane Superior Court. Plans for the firm to build a corporate headquarters in Tennessee were abandoned in 2010.

Wire fraud carries a potential criminal fine of up to $250,000 and a prison sentence of up to 20 years under federal law.