Michael Catain

Catain, originally from Los Angeles, moved to Minnesota in the mid-1990s. He was president of Universal Capital Group, a liquidation and appraisal company. He and Petters did several business deals, including joint ownership of a music company. Liquid 8 Records and Entertainment eventually came to produce artists that included everything from Gospel and children's music to John Oates and rapper Vanilla Ice. Liquid 8 was affiliated with a holding company called Enchanted Entertainment. Catain lived on Enchanted Point on Enchanted Island in Lake Minnetonka. Catain started Enchanted Family Buying Co. in 2002. According to federal charging documents, it was a shell company and had no operations. The government alleges that Catain and Petters used false purchase orders at one point to obtain a $20 million loan. From 2002 to September of this year, a company controlled by Petters routed about $12 billion through the Enchanted company's account at Anchor Bank in Wayzata, the charges say. Catain kept a percentage of each transaction as a "commission," for a total of more than $3 million, documents allege.