New Indictment Adds to Dreier Victim Tally

New Indictment Adds to Dreier Victim Tally - 3-18-2009

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HEADLINES \| SETTLEMENTS AND DISMISSALS \| COURT FILINGS LINKS TO OTHER NEWS \| NEWS ARCHIVE	HEADLINES ARCHIVED SETTLEMENTS AND DISMISSALS ARCHIVED

HEADLINE NEWS:

New Indictment Adds to Dreier Victim Tally
Mark Hamblett

New York Law Journal. March 18, 2009
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EXCERPT: Indicted attorney Marc S. Dreier sold more than $700 million in phony real estate development notes and fake pension plan notes during his four-year scam, according to a superseding indictment released Tuesday. The new indictment, which adds a count of money laundering, also alleges a greater number of victims than initially thought. It accuses Dreier of selling notes to at least 13 different funds and three individuals between 2004 and 2008, with the purchase price wired to an attorney trust fund maintained by his firm. The overall loss to investors in Dreier's schemes remains roughly $400 million, but the realization that he sold as much as $700 million in bogus notes allowed the government to increase the amount it is now seeking in forfeiture. In addition to the new money laundering charge, the former sole equity partner in the now defunct 250-member Dreier LLP faces charges of conspiracy to commit securities fraud and wire fraud, one substantive count of securities fraud and five substantive counts of wire fraud. The superseding indictment sheds some new light on the scope of Dreier's efforts. The money laundering count covers transfers he allegedly made "into and out of various Dreier LLP bank accounts in order to promote fraud in the sale of securities and wire fraud." In addition to the 13 different funds and three individuals who are now alleged victims of his scams, the indictment states that Dreier "enlisted financial professionals to assist him in finding purchasers of the fictitious promissory notes and paid those individuals a percentage of the proceeds received.” It also states that Dreier "attempted to sell the notes to numerous additional potential investors and funds." Dreier also represented himself as the lawyer for the issuers or holders of the promissory notes.

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