Thursday, June 28, 2012
A Con Man Who Lives Between Truth and Fiction - By Andrew Ross Sorkin
“I’m a proven liar. Don’t believe anything I say.”
That was what Samuel Israel III told me last week. He is the hedge fund manager convicted of running a $450 million Ponzi scheme who faked his own suicide in the summer of 2008 to avoid his prison sentence before turning himself in after a worldwide manhunt.
He was sitting across from me in the visiting center of the Butner prison complex, about 45 minutes north of Raleigh in eastern North Carolina. (Bernard L. Madoff is in the same complex.)
Mr. Israel, 52, who is serving a 22-year sentence, was wearing a tan prison uniform with his hair grown out, a mass of silver and brown curls sprouting from the sides of his bald head. (“I’m never going to cut it until I get out,” he exclaimed.)
I was there to talk to him because his story is a cautionary tale of the highly sophisticated, often endemic, fraud that still lurks on Wall Street. People I spoke with who dealt with him are still mystified about the breach of trust and how no one had a clue about his deception until it was too late.
Octopus: Sam Israel, the Secret Market, and Wall Street’s Wildest Con