Russell Wasendorf Sr., the founder of the bankrupt commodities firm Peregrine Financial Group Inc., was sentenced to 50 years in prison for what prosecutors said was a theft of more than $215m from customers.
Bloomberg reports that Wasendorf, 64, was sentenced Thursday in federal court in Cedar Rapids, Iowa, Acting U.S. Attorney Sean Berry said in a statement. The financier used a printer, software and a post office box to create false bank statements and other documents and hide his 20-year embezzlement starting in the early 1990s, prosecutors said.
'By lying to investors and regulators, Wasendorf defrauded thousands of innocent investors out of a staggering $215,000,000', Berry said in the statement. 'The lengthy prison sentence imposed.... is just punishment for a con man who built a business on smoke and mirrors'.
Assistant U.S. Attorney Peter Deegan told U.S. District Judge Linda Reade in court filings that Wasendorf deserved the maximum 50-year penalty because of the amount customers lost and the sophisticated nature of the crime. Wasendorf started stealing customer funds within two years of Peregrine’s original financing, using a copying machine to conceal his theft of $250,000 to keep his company afloat, the government said.
'Defendant’s entire business was used as a mechanism to gather and purloin investor funds', Deegan said. 'From that point on, as defendant well knew, PFG was never profitable'.
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