NYC lawyer accused of $380M scam argues for bail
NYC lawyer accused of $380M scam argues for bail
By LARRY NEUMEISTER – 4 days ago
NEW YORK (AP) — A prominent lawyer accused of cheating hedge funds in a $380 million investment ruse argued to be freed on bail Thursday, saying in court documents he's no risk to flee because his U.S. ties are strong and his foreign connections are weak.
Marc Dreier said all his relatives live in the U.S. and only a few of his business associates or friends live abroad.
Dreier, 58, has been jailed without bail since he was arrested in early December as he returned from Canada. He could face up to 20 years in prison if convicted.
Dreier's lawyers have proposed that he be released on $10 million bond, secured by the signatures of his son and mother, and kept under house arrest with electronic monitoring and armed security guards approved by the government. He would be denied computer access and have only preapproved visitors.
The conditions would be similar to those of Bernard Madoff, who has confessed to losing up to $50 billion in a giant Ponzi scheme and is holed up at his multimillion-dollar penthouse.
Dreier, who led a law firm with more than 200 lawyers before his arrest, told a magistrate judge who will consider the bail issue that he no longer controls any money or assets in the United States or abroad.
He noted that his assets have been put in receivership, his bank and brokerage accounts were frozen, his property has been seized, his law firm has been dismantled and put into bankruptcy and his license to practice law has been suspended.
He said he had provided the receiver with a detailed accounting of his assets, including a yacht, 150 works of art and four luxury vehicles.
Dreier also said he returned to the United States from abroad four times in the weeks before his arrest, knowing he was likely to face criminal prosecution.
He said he was directly confronted in late October or early November by the principal of the real estate development company whose notes he was charged with fraudulently issuing and by a principal of the accounting firm whose audit letters he was charged with falsifying.
He said a lawyer for the accounting firm told him that "the matter was extremely serious and that the accounting firm was inclined to `turn the matter over to enforcement' if I could not conclusively demonstrate my innocence."
Dreier said his explanations were repeatedly rejected during telephone calls.
"During the several weeks that these calls occurred, when I knew full well that I was facing the prospect of criminal charges, I was in foreign countries no less than four times," he said. "Nevertheless, realizing my exposure, I still chose to return to the United States each time. I did so from St. Martin, from the United Arab Emirates, from Qatar and from Canada."
He said he had a private plane ready to take him to any destination he wished on Dec. 2 at a Toronto airport but chose to stay to answer the questions of representatives of the Ontario Teachers Pension Fund who told him they believed he had engaged in impersonation and fraud.
After he was arrested in Canada, he agreed to return to the United States rather than remain in Toronto or flee, even though he was told by his attorney he would be arrested when he arrived in the United States, he said.
Dreier's lead lawyer, Gerald Shargel, said in court papers that prosecutors were wrong to claim Dreier might have hidden assets overseas. He said Dreier had spent hours with the court-appointed receiver, answering every question.
"He never needed to be prodded nor pushed," Shargel said.
A spokeswoman for federal prosecutors, Janice Oh, said she had no comment
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