Dreier Wins Bail, But Can’t Afford It

Jan 23 2009 | 1:04am ET

Marc Dreier, the once-prominent New York lawyer accused of ripping hedge funds and other investors off to the tune of more than $400 million, could be freed on bail, if only he could afford it.

U.S. Magistrate Judge Douglas Eaton—hours after ruling that Dreier be held without bail until trial—changed his mind, and said the accused fraudster could be released if he posts a $20 million bond. That figure, which also requires four co-signers, home detention and electronic monitoring, was twice that sought be his lawyers.

“Effectively, that will keep my client in jail,” Gerald Shargel, Dreier’s attorney, said. Shargel said he will probably appeal the bail amount.

Shargel argued that Dreier, whose eponymous Park Ave. law firm once employed 250 lawyers but has since his arrest filed for bankruptcy, argued that his client has cooperated with his firm’s receiver, and that he has no overseas assets to fund a flight. Shargel cited Eaton’s own bail conditions imposed on another accused hedge fund fraudster, Bernard Madoff, who is free on $10 million bail, and said Dreier’s sister and mother had agreed to pay to have the disgraced lawyer under armed guard at his 58th Street apartment. Prosecutors opposed the bail request.

Eaton, who has been roundly criticized for allowing Madoff to remain free, if confined to his luxury Manhattan apartment, brushed aside the comparison.

“I think the risk of flight is greater in Mr. Dreier’s case than in Mr. Madoff’s case,” Eaton said.

Dreier was arrested in Canada on charges of impersonating a pension fund lawyer at a meeting with Fortress Investment Group, before being charged with defrauding investors in the U.S. upon his return. Dreier and several associates are accused of posing as representatives of legitimate businesses to rip off investors. In one case, he allegedly convinced two hedge funds to buy more than $100 million in phony discount notes that he claimed were issued by a prominent New York developer.

In their letter to Eaton, prosecutors once again revised up the amount that may have been lost in Dreier’s alleged fraud to more than $400 million.


In Depth

Hedge Fund Veteran Peter Borish Talks Trading

Dec 17 2014 | 9:32am ET

Peter Borish says 2014 was “tricky” from a trading perspective. “The best...

Lifestyle

Cohen Donates $1.5M To GOP Governors Association

Dec 10 2014 | 7:13am ET

The Republican Governors Association raised close to $25 million from October 1...

Guest Contributor

Q&A With Daniel Gallancy: Institutional Interest In Bitcoin Is Growing Steadily

Dec 12 2014 | 7:54am ET

Daniel Gallancy is founder and CEO of SolidX, a provider of total return swaps for...

 

Sponsored Content

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

December 2014 Cover

Futures 2014 person of the year

Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.