Woman Who Invested Almost $700,000 With Browns Files Suit Against Jason And Kim Brown, Office Staff, Bank, Insurance Firm

Thursday, July 11, 2013

A woman who invested almost $700,000 with the now-defunct Brown's Tax Service in Soddy Daisy said she was talked into signing up for an annuity plan that would not mature until she was 115 years ago.

Margie Y. Elliot also said that Jack Brown induced her to make numerous withdrawals from the annuity even though there were large penalties and tax losses each time that she did not know about.

She filed suit in Chancery Court against Jason and Kimberly Brown, Ellen Brown, Angie W. Wilson, Soddy Daisy Money Express, ABC Daycare and Learning Center, Compumed Billing, Community National Bank and North American Company for Life and Health Insurance.

Chancellor Jeff Atherton signed an order to show cause and ordered the defendants to appear before him on Sept. 4 and show why there should not be an accounting of Ms. Elliot's funds.

The suit notes that Jack and Janet Brown cannot be sued because they have filed for bankruptcy. It says they and other defendants were part of a Ponzi scheme that took large amounts of money from a host of individuals - including many in the Soddy Daisy area where the Browns were located.

Ms. Elliot said the Browns prepared her taxes and learned that she had over $700,000 in investments.

Though she was already 68, she was talked into purchasing an annuity for $697,788.87 even though it would not mature until 2057.

The penalty for withdrawal was 18 percent the first two years, 17 percent the third year, 15 percent the fourth through seventh year, 14 percent the eighth year, 12 percent the ninth year, 10 percent the 10th year, eight percent the 11th year, six percent the 12th year, four percent the 13th year and two percent the 14th year.

The suit says that type annuity with high early withdrawal penalties "is the type of annuity that earns the highest commission to the agent of North American that is selling the policy."

It says, "There was no need for an annuity that was 47 years to mature because in 47 years she would be 115 years old were she to live that long and she knows of no one that has lived to the age of 115."

The suit says Ms. Eliot was talked into making withdrawals of $37,500, $37,500 and $41,176 to invest with Jack Brown. She had penalties of $7,500 each time as well as tax liabilities.

It says funds from investors were diverted to Brown officials, including Jason Brown, son of Jack and Janet Brown. The suit says he was paid $52,000 in salary, a housing allowance of $26,400 and bonuses as much as $385,500.

The suit says Community National Bank knew of the Brown operations, but "the bank deliberately ignored the Brown Ponzi scheme because the account was generating fees, the Browns had individual or joint accounts with the bank, which increased their deposits and that allowed the bank to loan more money based on its higher deposits."

It says the insurance company called Jack Brown to ask about an annuity policy stretching until the holder was 115 years old, but did not call Ms. Elliot to ask her why.

The complaint says Ellen Brown and Angie W. Wilson worked in the office and were also in on the Ponzi scheme. It says Ellen Brown is a sister-in-law of Jack Brown and Angie W. Wilson is the niece of one of the Browns. 

The suit was filed by attorneys Owen Maddux, Jerry Tidwell and W. Adam Izell.



Latest Hamilton County Jail Booking Report

Here is the latest jail booking report from Hamilton County: ADAMS, MICHELLE DESHAUN  113 GOODSON AVE CHATTANOOGA, 37421  Age at Arrest: 28 years old Arresting Agency: Hamilton County DRIVING ON REVOKED LICENSE REGISTRATION, IMPROPER DISPLAY OF PLATES --- ALLEN, CHRISTOPHER LAMOND  4410 MIDLAND PIKE CHATTANOOGA, 37411  Age at Arrest: 49 years ... (click for more)

School Board Approves Moving Forward On $290,000 Equity Consulting Contract

The County School Board voted 8-1 on Thursday night in favor of a $290,000 contract with consultants to help with an equity study. Officials said there will be no cost to the school system,but it was not clear who will be paying. Board member David Testerman asked, "How do we know who's going to provide the funding?"  Supt. Bryan Johnson indicated he is confident that ... (click for more)

Speaking Of A Cove

Mr. Sole Commissioner Whitfield,   I live in  a cove in western most Chattanooga. My back yard is woods. My front yard is woodland too. My neighbors and I had chance to voice our disagreement in 1996 to the proposed sale of a portion of the farm that dominated this cove and we did. There weren’t very many of us. One member of the group that listened to ... (click for more)

Roy Exum: 'Don't Dare Endorse Me!'

When Joe Smith, a member of the Hamilton County School Board, met with officials of the UnifiEd political action committee on Tuesday, his instructions to his somber listeners were very specific. He told the leaders of the now-tainted education non-profit group. “Do not endorse me. I extended the courtesy of answering your questions … I am eager to do the right thing. But I am saying ... (click for more)

Baylor Wins D-II State Baseball

MURFREESBORO, Tenn. – The Baylor School baseball team has been on a tear these past couple of weeks as they’ve been averaging double figures in runs scored and base hits. It's become quite a winning combination. That trend continued here at MTSU’s Reese Smith Jr. Field on Thursday afternoon in Baylor’s biggest and most important game of the season. Facing the Memphis University ... (click for more)

Baylor Wins Fourth Straight State Softball Title

MURFREESBORO, Tenn. – The Baylor Lady Red Raiders and the GPS Bruisers have had some classic battles on the softball field in recent years, many times in the championship game of the Division II-Class AA portion of the state tournament. They met again on Thursday night on Starplex Field No. 3. Baylor won for the third time this year, but there’s really no way to adequately ... (click for more)