Limo-Driving Hedge Fund Fraudster Seeks Leniency

Jun 8 2010 | 9:52am ET

Lawyers for the limousine driver who earlier this year pleaded guilty to running a $20 million hedge fund fraud have asked a judge for mercy, citing their clients’ struggle as an immigrant from the Soviet Union.

Alan Fishman, who pleaded guilty to conspiracy in March, launched his A.R. Capital Global Fund with the best of (legitimate) intentions in 2003 in an effort to help his nephew and get off his “road to nowhere” driving around bankers and lawyers in New York. But his lawyer admitted that, “what began admirably, ended quite dishonorably.”

Prosecutors say that A.R. bilked 70 people out of $20 million, with Fishman and Gelman promising to invest in overseas real estate, currencies, oil, gas and other commodities. But prosecutors say they did no “active, leveraged trading” at all, and that it is doubtful they ever planned to do so.

Fishman, who was not only a popular driver for New York’s Dial Car, one of its largest limo services, but also served on its board of directors for a decade, faces up to five years in prison when he is sentenced on June 18. But his court filing places most of the blame for the A.R. scam on Gelman, who remains on the lam and is believed to be in the Ukraine.

The hedge fund was Gelman’s idea, Fishman’s lawyer says. What’s more, Fishman, despite telling investors that he made the investment decisions, was merely responsible for administration and accounting. And while Fishman hoped the hedge fund would get him out of the limo driving business, he also had an altruistic motive, according to a letter to the court from his daughter.

Fishman “thought that stable employment and a good business would solve Gary’s gambling addiction and personal debt,” she wrote to U.S. District Judge Denise Cote. “My father was wrong.”

Fishman’s mother added a plea for mercy, calling her son’s case a “tragedy.”

“Dear Judge, what I want to ask you is that you could find some leniency for my boy.”

“He does regret, and is ashamed, that he did not have the discipline and the courage to prevent the misrepresentations made to potential investors,” Fishman’s lawyer, Don Savetta, told Cole.

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