Peregrine CEO Arrested on Fraud Charges

According to the Chicago Tribune, the founder and CEO of Peregrine Financial, a now-defunct futures brokerage firm that filed for bankruptcy protection last week and was formerly headquartered in Chicago, has been arrested on federal fraud charges. Russell Wasendorf Sr. was formally charged on Friday, five days after he attempted suicide in the parking lot of Peregrine’s Iowa headquarters, leaving behind a note which allegedly admitted to his guilt over 20 years of fraud that he had committed.

The federal criminal complaint alleges that Wasendorf made false statements to the U.S. Commodity Futures Trading Commission over the past two years regarding the segregation of client funds, supported by an elaborate fraudulent scheme to support his falsehoods. Allegations also have been made that he misappropriated over $200 million in client funds. Peregrine CEO Arrested on Fraud Charges

In a related Tribune story, Peregrine and Wasendorf also are facing employment-law related issued. After allegations of Wasendorf’s fraud caused the company to collapse, Peregrine laid off more than 300 workers with no notice. One of the laid-off employees is reportedly suing Peregrine and seeking class action status for his lawsuit, alleging that Peregrine failed to give the required 60-day notice to employees before they were laid off, pursuant to the federal Worker Adjustment and Retraining Notification Act. Given Wasendorf’s federal criminal charges, however, this lawsuit may be the least of his worries.

Federal fraud charges are extremely serious, as they can result in substantial fines, restitution to the victims, and federal prison time. This crime is typically classified as white collar crime, which is a crime that is often of a financial nature and committed by a professional of some sort. Therefore, the evidence supporting the accusations is likely to involve large amounts of paperwork, some of which may have been falsified. If you find yourself in this situation, you will need the assistance of an experienced Naperville criminal defense attorney to help mount the best defense possible in your case.