The Montana State Auditor’s Office has frozen the investment accounts of a Columbia Falls woman under investigation for allegedly investing money without proper registration and mishandling more than $1 million in a suspected Ponzi scheme.

According to Jesse Laslovich, chief legal counsel to the Auditor’s Office, Flathead District Judge David Ortley issued an order on April 15 freezing the investment accounts of Catherine Ann “Cathy” Finberg of Columbia Falls.

A hearing for Laslovich to present witnesses who could further support the asset freeze was postponed.

“At the request of counsel for Miss Finberg, it has been continued until May 25,” Laslovich said.

Laslovich confirmed that the Finberg under investigation is the woman by that name who has served as the Columbia Falls assistant girls basketball coach.

Attorney Dave Cotner of Missoula said the Datsopoulos, MacDonald and Lind office is representing Finberg.

“We are cooperating with the state Auditor’s Office at this time and continuing to work through their investigation,” Cotner said.

Cotner has been working with state officials to notify people who gave Finberg money about the investigation and asset freeze.

According to court documents, possible misconduct by Finberg was noticed by the Auditor’s Office in February after her accounts were flagged by Glacier Bank employees who filed a notice with the Federal Bureau of Investigation about suspicious transactions.

Another investigation had been opened by the Columbia Falls Police Department regarding Finberg’s handling of finances for a disabled person, court documents claim.

From 2008 until 2016, Finberg allegedly obtained investments of $1,294,300 from more than 18 people. Finberg allegedly put this money into an investment account that she used for day trading and lost $275,000. She also allegedly withdrew $741,000 from the account and put it in her personal bank account.

One of the investors was the grandparent of a disabled individual. The disabled person was named the beneficiary of a retirement account, and $75,000 allegedly was transferred to Finberg’s personal account at Glacier Bank.

Investigators found that $44,000 of that money was transferred to an investment account, and Finberg allegedly used $31,000 for her personal use.

A forensic accountant determined that Finberg typically wired a portion of investment proceeds to a personal account in Connecticut and retained some of the money for personal use and to make monthly payments to previous investors.

The accountant found that each month, Finberg wrote checks averaging $3,805 to investors, wired an average of $1,950 to pay off a personal Bank of America Credit Card, wired $500 to pay off her personal Chase Bank credit card and paid her $1,730 mortgage.

“These payments were paid primarily with the investment proceeds of individual investors,” wrote Lynne Egan, the forensic accountant who performed the investigation for the Auditor’s Office.

Laslovich’s filings say that his office could not find evidence that Finberg has ever been registered to invest as a securities broker-dealer as required by state and federal law.

Laslovich said no charges had been filed in the case since the investigation is ongoing.

He encouraged people considering investing their money to check and make sure brokers are registered by making a call to the state Auditor’s Office.

“We can look for two things: One, if they are registered — if they are not, there’s a red flag,” Laslovich said. “If they are, we can check for [other] red flags.”

Authorities note in court documents that they believe Finberg owes investors $997,302.

Cotner gave few details of Finberg’s possible defense in the case, but said that there was some question about whether the funds involved were loans or investments.

“We are working with [state officials] in an effort to get ahold of various individuals that loaned or invested money with Cathy,” Cotner said.

Cotner also said that he believes Finberg previously was legally registered in another state to invest money, but he could not definitively say which state she was registered in or when she was registered.

Finberg could not be reached for comment.

Laslovich is currently a Democratic candidate for state auditor.

Reporter Megan Strickland can be reached at 758-4459 or [email protected].