Samuel Israel III

On September 29, 2005, Samuel Israel III, the founder of the Bayou Group hedge fund based in Stamford, Connecticut, along with his CFO, Daniel Marino, pleaded guilty to conspiracy and fraud charges related to the spectacular collapse of the company's hedge fund. The fraud reportedly started as early as 1998, shortly after the fund was opened. It involved the overstatement of gains and the understatement of losses leading to a fraud that was estimated to be in excess of $300 million. According to reports, Marino even created a fake accounting firm to give the appearance to investors that the fund was doing well. Israel faces up to 30 years and Marino up to 50 years in prison. A third executive, James C. Marquez, who founded Bayou with Israel, pleaded guilty to fraud charges as well. In January 2008, Marino was sentenced to 20 years in prison. On April 14, 2008 Israel was also sentenced to 20 years in prison by the federal court. At his sentencing hearing, US District Court Judge Colleen McMahon said of Israel, "You were, in every meaning of the sense, a career criminal. You ruined lives. Financial fraud, white-collar crimes are every bit as heinous as every other type of crime and they will be punished severely." However, Israel did not show up for his prison sentence on June 9, 2008 and his abandoned SUV and an alleged suicide note was found, but no body. An investigation and search for the body ensued but authorities quickly determined that Israel’s apparent suicide was faked. His then girlfriend, Debra Ryan, apparently admitted that she had driven with Israel and abandoned the SUV and that the suicide was a ruse. The saga finally ending when Israel turned himself into Southwick, Massachusetts police on July 2, 2008. At a hearing the following day, Israel claimed he attempted suicide by swallowing morphine pills and fentanyl, a pain killer, but the judge was not sympathetic. On July 15, 2009, Israel was sentenced to an additional 2 years in prison for jumping bail by faking his suicide and for failing to show up for his prison term. For her part in helping Israel, Debra Ryan was sentenced to three months probation. Israel is currently serving his sentence at the Fort Devens federal prison in Massachusetts.