Bayou Founder Alleges Prison Medical Malpractice, Wants Early Release

May 9 2014 | 11:32am ET

Samuel Israel, the hedge fund fraudster who faked his own death in an effort to avoid prison, says more time behind bars will bring the real thing.

Israel, co-founder of the Bayou Group, has asked a federal judge to release him, alleging “gross medical malpractice” on the part of prison doctors. He alleged that poor treatment led to a chest infection that nearly killed him last May, and that the prison unjustifiably withheld pain medication.

Israel said the latter was due to his removing a pain medication patch—and eating it. He called the move “an isolated act of desperation,” one that led to 100 days isolated in the prison’s special housing unit and Israel’s removal from the drugs the he used to treat his pain, including methadone.

Israel was sentenced to 22 years in prison—he got an extra two after going on the lam the day he was due to report to prison in 2008—for ripping Bayou investors off to the tune of $450 million. He’s asked the judge who sentenced him, U.S. District Judge Colleen McMahon, to set her verdict aside and resentence him to time served.

Israel told McMahon that his heart beats too slowly, that he suffers from a degenerative spine condition, is in chronic pain and has depression. He said that the incident last May was due to a botched replacement of the battery in his pacemaker: Israel said the prison waited too long to schedule the procedure, leading him to pass out and hit his head. When the operation was finally completed, prison doctors allegedly left sutures in his chest, which became infected and which required a trip to an outside hospital to remove the pacemaker.

Israel remains without it and “must sometimes jump up and down to elevate his heart rate so that he will not lose consciousness,” his lawyers wrote.

McMahon certainly doesn’t seem likely to be swayed: During his trial, Israel’s lawyers accused her of prejudice against their client. She accused Israel of seeking to “endlessly postpone” his sentencing, which came three years after he pleaded guilty.


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