Hedge Fund Gets Dreier's Art Collection

Aug 14 2013 | 9:18am ET

A New York hedge fund is the proud new owner of an impressive art collection—one that belonged to disgraced lawyer and fraudster Marc Dreier.

Heathfield Capital, which U.S. District Judge Jed Rakoff called "the last and largest victim of Dreier's fraud," received 18 works of art, pledged as collateral by Dreier, from the U.S. Marshals Service, the Manhattan U.S. Attorney's Office said. The pieces, by Damien Hirst, Mark Rothko, Andy Warhol and others, are worth a combined $33 million.

Rakoff approved the transfer last month.

Dreier pleaded guilty in 2009 to defrauding hedge funds of more than $400 million, admitting that he sold more than 85 fake promissory notes he claimed were issued by a prominent New York developer. At least 13 hedge funds fell for the ruse, including boldface names like Elliott Management, Eton Park Capital, Fortress Investment Group and GSO Capital Partners. Dreier was sentenced to 20 years in prison for his crimes.

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