Petters Takes The Stand, Points Fingers

Nov 20 2009 | 9:14am ET

Accused Ponzi scheme mastermind Thomas Petters told the jury considering his fate that he was not responsible for the massive fraud at his company.

In fact, Petters testified, he only learned of the alleged $3.65 billion scam after it was well underway, and only acted in an effort to save his business empire. Petters, a Minnesota businessman and hedge fund manager, instead pointed the finger at his subordinates, many of whom have already pleaded guilty and testified against him.

Petters, who faces 20 counts of fraud and money laundering, among other crimes, tried to explain away a comment he made to Deanna Coleman, former vice-president of operations at his company.

“What I mean by that statement, ‘one big fraud,’ is this is one big fraud,” he testified. “We committed fraud, and we need to get in our attorney’s office right now and fix it.”

As for his effort to raise money by selling licenses for some of the companies he owned, including Polaroid and Sun County Airlines, he said he was doing it to pay off his hedge fund investors.

“It would have given us cash for the hedge funds, so the hedge funds wouldn’t be telling me I was going to jail through the SEC,” he said. “Everybody would have survived, I believe.”

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    One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…