Petters Sentencing Delayed

Feb 16 2010 | 11:11am ET

Thomas Petters, the Minnesota businessman and hedge fund manager convicted last year of running a $3.65 billion scam, will be sentenced on March 15.

Petters was originally scheduled to be sentenced on March 10. He faces up to life in prison.

Despite his protestations of innocence, Petters was convicted of 20 counts of fraud and money laundering in December.

Petter’s fraud, which came to light just months before the much larger Ponzi scheme orchestrated by Bernard Madoff collapsed, involved selling bogus notes linked to consumer electronics sales which prosecutors say never actually happened. Investors in Petters Co. were told they were buying bulk electronics which were being resold to big-box retailers.

At least 20 hedge funds were the chief victims of the scheme, according to the complaint, and at least one allegedly helped Petters cover up his scam. In October, Lancelot Investment Management founder Gregory Bell pleaded guilty to mail fraud, admitting he co-engineered a series of bogus “roundtrip” transactions with Petters designed to hide losses and keep the Ponzi scheme afloat.

Petters, whose business empire once also included Polaroid Corp. and Sun Country Airlines, claimed the fraud was orchestrated by his underlings without his knowledge.

U.S. District Judge Richard Kyle, who oversaw Petters’ trial and will sentence him next month, has also been tasked with sentencing the six people who pleaded guilty in the case, including Bell. Those sentencings, which were originally assigned to another St. Paul, Minn., federal judge, are to take place after Petters’ sentencing.


In Depth

Q&A: Filippo Pignatti Morano On The Ultimate Alternative Investment...Classic Cars

Jan 29 2015 | 12:37pm ET

In 2011, Filippo Pignatti Morano launched a fund to invest in classic cars. FINalternatives...

Lifestyle

Looking For A Hedge Fund Manager? Try Davos

Jan 28 2015 | 8:48am ET

Davos, Switzerland seems to have become the hedge fund capital of the world—at...

Guest Contributor

Five Tips For Successfully Marketing Your Hedge Fund

Jan 30 2015 | 9:14am ET

When it comes to the hedge fund industry, the notion of “build it and it will...

 

Editor's Note