Petters Whistleblower Sentenced

Sep 8 2010 | 12:23pm ET

Deanna Coleman, who blew the whistle on Minnesota businessman and hedge fund manager Thomas Petters’ $3.65 billion fraud, will be joining him in prison for the time being.

Coleman, who served as vice president of operations at Petters’ firm, was sentenced to a year and a day in prison for her role in the scam, which victimized at least 20 hedge funds. Coleman began cooperating with the Federal Bureau of Investigation two years ago—before which the authorities had no idea that something was amiss at Petters’ operations.

Coleman testified against Petters at his trial last year. Petters was convicted of 20 counts of fraud and money laundering in December. Prosecutors accused him of selling bogus notes linked to consumer electronics sales which never actually happened. Petters was also accused of employing at least one hedge fund to help him cover up his scam.

He was sentenced to 50 years in prison and has vowed to appeal his conviction.

Despite the fact that Petters might still be ripping people off if not for Coleman’s cooperation, U.S. Attorney B. Todd Jones noted that she “worked with Petters and others to dupe people out of a lot of money.”

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