Peregrine Financial Founder Pleads Not Guilty

Aug 21 2012 | 10:18am ET

Peregrine Financial Group founder Russell Wasendorf may have already confessed to running a $200 million fraud, but in court, he wasn't ready to make any such admission.

Wasendorf, who was arrested last month as PFG collapsed, pleaded not guilty to 31 counts of lying to regulators on Friday. Wasendorf has been held in prison since his arrest and attended the 10-minute hearing in Cedar Rapids, Iowa, federal court in an orange prison jumpsuit and in shackles. He is the only person who has been charged in the futures brokerage's failure.

Wasendorf attempted to commit suicide as his alleged fraud unraveled. Investigators found a confession apparently written and signed by Wasendorf in which he admits he "committed fraud" and "cheated," and lambasted regulators for harassing him.

The note also allegedly includes the admission that he took "more than $100 million" in client money to shore up the firm, pay fines and fees, and build PFG's new Cedar Falls, Iowa, headquarters.


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