Arrest Warrant Issued For Missing Bayou Fraudster

Jun 12 2008 | 2:00am ET

A federal judge has issued a bench warrant for the arrest of Samuel Israel, the Bayou Group co-founder who make have faked his suicide to avoid reporting to prison.

The warrant was issued Monday—the day that Israel was to report to a Massachusetts prison to begin a 20-year sentence for defrauding investors of $450 million—but not announced until yesterday.

Israel’s SUV was found on the Bear Mountain Bridge, 40 miles north of New York City, on Monday afternoon. It had the words “suicide is painless” etched in the dust on its hood, but Israel’s body has not been found, despite days of searching the Hudson River below.

“At the request of the U.S. Attorney’s Office that same day, United States District Judge Kenneth M. Karas issued a bench warrant in White Plains federal court for Israel’s arrest,” Michael Garcia, U.S. attorney for the Southern District of New York, said. “The United States Marshals Service and Federal Bureau of Investigation are actively searching for Israel and have not ruled out any possibilities.”

The FBI reportedly believes that Israel was picked up from the bridge by another vehicle and spirited away.

“A dose of professional skepticism is appropriate,” FBI spokesman Jim Margolin told USA Today. “We are taking certain steps to ensure he doesn’t leave the country.”

He added, “we and the marshals will continue to look for him until we find him, in whatever condition he may be.”

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