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Hedge Fund Fraud Gets 20 Years

Posted Apr 14, 08 4:45 PM CDT in Crime & Courts,  Business 

(Newser) – The founder of defunct hedge fund Bayou Group was given a 20-year prison term today for bilking investors out of more than $400 million, Bloomberg reports. Samuel Israel must also pay $300 million in restitution for masterminding a “ponzi scheme” in which investment returns were paid with new investors’ money. His sentence is the longest for a white-collar crime since Enron litigation.

"You were, in every meaning of the sense, a career criminal … you ruined lives," US District Judge Colleen McMahon told Israel at sentencing. "Financial fraud, white-collar crimes are every bit as heinous as every other type of crime and they will be punished severely."

Sources Bloomberg, Reuters

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Samuel Israel III, right, arrives at the United States Courthouse in New York, Monday, April 14, 2008.   (AP Photo/Craig Ruttle)
Samuel Israel III, the former CEO of Bayou Group, arrives at Manhattan federal court for his sentencing, Monday, April 14, 2008, in New York.   (AP Photo/ Louis Lanzano)
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fraud • prison • hedge fund • white collar crime • Samuel Israel • Bayou Group • defrauding investors


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