Wall Street Folly

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Sam Israel finally pleads guilty to bail jumping

It had been delayed several times since he was under medical care, but yesterday scammer Sam Israel, former head of hedge fund Bayou, pleaded guilty to bail jumping.  He faces up to 10 additional years which will be tacked on to his 20 year sentence from last April;  sentencing is scheduled for June 24.

U.S. fund swindler pleads guilty to jumping bail - Reuters

Sam Israel's girlfriend: I got screwed and I liked it (in fact it was "great. The best ever")

Maybe that thought is too much information, at least early in the morning.  But that's the picture that the girlfriend of the now incarcerated hedge fund scammer who screwed his investors (who weren't nearly as pleasured) out of millions, tried to fake his own suicide then went on the lam, has painted for Mary Claire magazine in an interview.  Israel rocked Debra Ryan's world with "blazing sex" early in their relationship.  And after Israel was given a 20 year sentence in April, the first thing on the agenda was "crazy sex".  "It was great.  It was the best ever".  What did all that hot sex cost her?  She's $500K in debt and has a prison record.  Sam's Israel was also apparently quite the jokester, once doing something a bit shady (warning: there's a not work friendly picture below).  According to Page Six:

Hedge fund swindler Sam Israel is being sent to a federal medical prison

Sam Israel, the bail jumping hedge fund swindler who tried to fake his own suicide to avoid prison is being sent to a federal medical prison facilty for 90 days according to Reuters.

At a hearing in U.S. District Court in White Plains, New York, Israel's lawyer made the request for the former head of the collapsed Bayou hedge fund group to be physically and psychologically evaluated at the prison in Butner, North Carolina.

Prosecutor Sarah Krissoff agreed to the request, and U.S. District Judge Kenneth Karas scheduled the next hearing for Feb. 27, 2009, according to Herbert Hadad, spokesman for the U.S. Attorney's Office for the Southern District of New York.

Bayou fund swindler to go to medical prison - Reuters

Former Bayou hedge fund leader / swindler / suicide faker not competent enough to plead guilty to bail jumping

Sam Israel, the convicted Bayou hedge fund scammer who faked his own death on the day he was to begin his prison sentence, then fled before ultimately turning himself in weeks later, appeared in court today to plead guilty to the added charge of bail jumping.  But because he was drugged up from a methadone treatment regimen that was started two weeks ago to help end his addiction to pain patches he had been taking for a back condition, and was only "60 to 70 percent" with it, U.S. District Judge Kenneth Karas said that he couldn't be sure that Israel was competent enough to make the plea. 

``I have to be satisfied that you're competent,'' U.S. District Judge Kenneth Karas said, rejecting the plea to one count of failure to appear. ``The fact that there is some doubt about that makes it imprudent to go forward today.''

``I can understand what's going on here today,'' Israel said during the hearing in front of Karas this afternoon. ``I don't think you should put it off, it's fine.''

The judge set another hearing for September 16.

Sam Israel Barred From Pleading in Fake Suicide Case - Bloomberg

CNBC: Fugitive Sam Israel has been nabbed!

OK, we were wrong.  He didn't somehow abscond to Namibia.  CNBC is reporting that hedge fund scammer Sam Israel is a fugitive no more....he's been captured in Southwick, Massachusetts where he's said to have surrendered.

Love is blind: Sam Israel's girlfriend aided his getaway and is charged

She must really love the schumck a lot,  because her assistance in not-dead ex-Bayou hedge fund manager / fugitive Sam Israel's disappearance has gotten Debra Ryan, in a whole lot of trouble.  Israel's 45 year old girlfriend was arrested yesterday for helping him fill up a cushy RV and drive it to a rest stop off the highway around 24 miles from Armonk,NY on June 7.  Then she drove him back to the home she shared with him.  He disappeared later that day just as he was to surrender himself for prison.  She's out on bail of $75K and has until Monday to find a co-signer, and has given up her passport.

The RV plate numbers are EEN-5973, and if you see Israel, the U.S. Marshalls number is 800-336-0102.

According to an online ad posted by the previous owner, the 30-foot vehicle features "Oak Cabinets, Full Kitchen, Top/Bottom Fridge, Vinyl Floors, Carpet, Outside Shower, Split Bath, 3 Skylights, Queen Island Bed" and other amenities. It sleeps eight.

Authorities said Israel could be hiding out at an RV park, campground or highway rest area. He may be using the aliases Sam Ryan or David Clapp, and has a tattoo of a bird on his left arm. He takes narcotics for a severe back ailment and is a prescription-drug abuser. He should be considered armed and dangerous.

Gal Pal 'Jump' Roped - NY Post

Sam Israel: The long arm of the law may need to be way longer to catch the vanished hedge fund felon

If Federal Marshalls want to nab disappeared and definitely now presumed alive former Bayou hedge fund manager Sam Israel, they may have have an even longer arm of the law to reach him -- one that reaches "Back To The Future".  According to Page Six, there's a new theory about his disappearance.  They cite a trader who used to work with him in the 90's, who claims that Sam was crazy, and that he believed in time travel. He's said to have told people that he was working on a time machine for the government.  According to the trader:

"He brought two of my friends from Wall Street into his basement and showed them some contraption.  Now that's a nut case."

Personally, we're going with our first instinct from nanosecond we heard of his disappearance, then considered a possible suicide.  We vote for him being in Namibia.

Fled To The Past? - NY Post Page Six

Did he or didn't he?: Former Bayou head may have committed suicide days before he was to report to prison

Suicide, or did he too flee to Namibia?: Just as Samuel Israel III was to report to prison to serve a 20 year term for bilking hes former investors out of millions, state police are looking into whether the ex-leader of now defunct hedge fund Bayou Management committed suicide.  No body has been found yet but we wonder if a live body just might turn up in that haven favored by fleeing felons (Kobe Alexander, Wesley Snipes), Namibia.  Stay tuned. 

Bruce Cuccia, a state police senior investigator, said Israel's 2006 GMC Envoy sport-utility vehicle was found parked unattended with the keys in the ignition on the Bear Mountain Bridge in Westchester County about 12:30 p.m. EDT Monday. The bridge crosses the Hudson River at one of its deepest points, Cuccia said.

No suicide note was found, but written in the dust or pollen on the hood of the vehicle was, "Suicide is painless," Cuccia said. No body has yet been recovered, Cuccia said.

"We can't say conclusively at this point that he jumped off the bridge," Cuccia said. 

State Police Probing Ex-Bayou Exec's Possible Suicide - DJ Newswires

Bayou co-founder gets 4 1/4 years in prison

Bayou Group co-founder James Marquez was sentenced to 4 1/4 years in prison for defrauding investors out of $350 million.

U.S. District Judge Colleen McMahon said Marquez's creation of a sham accounting firm as part of the scheme was ``as reprehensible as anything in the storied history of securities fraud'' and that his actions with co-founder Samuel Israel and finance chief Daniel Marino led to a ``massive Ponzi scheme.''

``I made a terrible choice to take the easy way out when things started to go wrong,'' Marquez, 59, told McMahon today in Manhattan federal court. He must pay $6.2 million in restitution in addition to his sentence, which was nine months less than the maximum under federal guidelines.

Bayou, based in Stamford, Connecticut, is among the biggest hedge fund firms to come under scrutiny for missing money. The firm filed for bankruptcy in May 2006, prompting investor lawsuits that alleged it operated a Ponzi scheme in which old investors were paid off with money from new investors.

Bayou Co-Founder Gets 4 1/4 Year Sentence for Fraud - Bloomberg