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

Q&A: Neil Azous Talks Global Macro Investing

Nov 24 2014 | 12:41pm ET

Neil Azous is the founder and managing member of Rareview Macro, an advisory firm...

Lifestyle

Scene Last Night: Clinton, Schwarzman, Corzine, Neidich, Diamond

Nov 25 2014 | 5:52pm ET

Steve Schwarzman had a granddaughter yesterday morning. Last night he sat one table...

Guest Contributor

Why The Big Money Is Going To Europe

Nov 14 2014 | 6:03am ET

Peer-to-peer lending was invented with the individual investor in mind. But despite...

 

Sponsored Content

    For Hedge Funds, Mastering Data Is Key To Success

    Nov 4 2014 | 9:45am ET

    Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…

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

November 2014 Cover

Building a better market

Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...

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.