Two Wall Street managers arrested - $667 million "simply stolen"

[SOS]

Here we go again....

February 26, 2009 - The New York Times
Two Money Managers Held in New Wall St. Fraud Case - $667 Million Simply Stolen, Officials Say (edited)

For two decades, Paul Greenwood and Stephen Walsh looked like Wall Street wizards.

Their supposed investment prowess lured hundreds of millions of dollars from public pension funds and universities and earned the two lavish trappings of success: stately homes, a stake in the New York Islanders and, for Mr. Greenwood, a horse farm that once belonged to Paul Newman.

But on Wednesday morning, federal agents arrested the two money managers on accusations in what has become all too familiar on Wall Street: Their investment fund was in fact a $667 million fraud.

Mr. Greenwood and Mr. Walsh simply stole their investors’ money, the authorities said. Their two firms, the WG Trading Company and Westridge Capital, misappropriated funds from a host of deep-pocketed investors, including state and city pension funds, Carnegie Mellon University, the Iowa Public Employees’ Retirement System, the Sacramento Employees’ Retirement System and the University of Pittsburgh.

Mr. Greenwood, 61, and Mr. Walsh, 64, over the years had siphoned off most of the money and used it to finance high lifestyles and cover the costs of recent divorces.

Bail was set at $7 million each, and they were ordered to post $1 million in cash or property that was not from the apparent fraud

http://www.nytimes.com/2009/02/26/business/26scam.html

Robbing pension funds to buy mansions and pay ex-wives. Wall Street deregulation at it's finest.

[Veritas_et_Aequitas]

1. .

:puke:

[Tandalayo_Scheisskopf]

2. Just two more...

In a line that will ultimately stretch to beyond the horizon.

I am sure they will get nice accommodations at Allenwood, with rooms that open up onto the first tee.

[PA Democrat]

3. Wonderful. My son's tuition is already killing us.

I guess we can expect to see double digit increases between the funds stolen by these filthy criminals and the loss of funding from the state. These guys, if convicted need to be forced to sell everything they own down to the shirts off of their backs. And go after the ex-wives assets as well.

[seemslikeadream]

4. and why are Madoff and Stanford still running around?

[KansDem]

10. It's because these two stole *millions* not *billions*

:silly:

[DS1]

5. I think they'd also execute their ex-wives for that in China

not that I'm saying it's right

[SOS]

25. Not quite China, but Janet Walsh's mansion is on the line

Janet Walsh received a $3 million home in her divorce. Not looking too good for her today:

Five Relief Defendants Also Named

In addition, Westridge Capital Management Enhancement Funds Inc., WG Trading Company LP, WGI LLC, K&L Investments, and Janet Walsh are named in the complaint as relief defendants because they received funds as a result of defendants’ fraudulent conduct and have no legitimate entitlement to those funds.

[no_hypocrisy]

6. Almost everyone who's been through a divorces wishes he could steal $667 million.

[napi21]

7. I don't think they should have gotten bail at all! Throw their asses in jail

to await trial, and we all know how the legal system moves v e r y s l o w!!!!!!

[havocmom]

26. Would seem flight risks for sure. They prolly have some mad money stashed

UBS co-operating with investigators seems to have some well heeled folk sweating bullets.

Chaps that STOLE this kind of coin surely have some $$ set aside for a rainy day. If I were a judge, I would certainly consider them flight risks.

[SOS]

30. Some of the loot is "offshore"

"Another arm known as Westridge Capital Management Enhanced Funds is registered in the British Virgin Islands."

[havocmom]

31. Makes them flight risks then. They need to be in cells

Period.

Un-wealthy people, arrested for MUCH less serious crimes end up in cells. I want justice in America!

[SOS]

32. A couple of weeks ago

I saw a destitute alcoholic being led from a supermarket in handcuffs.
He was then placed into the back of an NYPD squad car.
His crime?
He had two cans of beer jammed down his pants.
$3 theft.

I wonder if these two "Wall Street wizards" spent one minute in the tombs?

[gratuitous]

8. "Steal" is such an ugly, lower caste word

Let us instead say "misappropriate" or "apparent" fraud. "Steal" rather lumps them in with common criminal types one sees on certain low-brow television programmes. Mr. Greenwood and Mr. Walsh surely don't deserve that!

[denverbill]

9. We need to start denying bail to these assholes.

They'll die before they go to jail.

[Phoebe Loosinhouse]

11. Can someone explain the distinction the NYT makes in this sentence:

"But unlike Mr. Madoff, who is accused of masterminding a global Ponzi scheme, Mr. Greenwood and Mr. Walsh simply stole their investors’ money, the authorities said."

Is masterminding a global Ponzi scheme NOT stealing? What exactly are they trying to say?

[Nickster]

13. I believe they were trying to say these guys didn't even make an attempt to appear legit and Madoff

had fake investment statements etc.

[Phoebe Loosinhouse]

15. I have to believe that they were sending out statments

If you are attempting to manage a pension fund or endowment or whatever, you need to know what the dividends are, long and short term gains, etc. Plus, apparently, like Madoff, they have been doing this for YEARS, so definitely year end- tax statements were going out.

I'm still not seeing what difference they are drawing with Madoff.

[arcadian]

24. The SEC requires notification for absolutely any change in an account's status.

Even if an account gains only $.01 in interest, written notification must be sent out to the account holder. That's the law.

[originalpckelly]

28. The real question: Did the SEC even check to make sure they...

were sending out real information in those statements? It appears not.

[KittyWampus]

14. Madoff went global and involved billions and these two schmucks were just pikers?

[IDemo]

12. Expected response: belt them around the mouth, and mouth them around the belt n/t

[originalpckelly]

16. It's time to stand up to the few, the shameless, the robber barons.

They really are robbers!

:wow:

Sucking people dry through the conventional methods was enough for these dirt bags, no they had to do worse!

[xiamiam]

18. how much more of this?...what do you do with that much money? how do you hide it?

[originalpckelly]

20. Fuck if I know, they're all a bunch of crooks.

Just a matter of how much they steal.

[Phoebe Loosinhouse]

17. The only thing surprising to me is that since LEGAL pilfering is allowed

by all these captains of industry siphoning off legally excessive management fees, bonuses, etc. that someone would actually turn to just plain old bread and butter theft. Greed and excess must actually set off some kind of maniacal delusion that the laws that regulate the little people don't apply.

Some irony must include the fact that a lot of EXTREMELY wealthy people are being burned big time by their former confreres who are running their hedgefunds and investments and screwing them to the max.

[originalpckelly]

19. They probably just sucked at playing the game...

so they turned to this shit.

[cloudbase]

21. Some of the CMU grad students

are probably working on some kind of remote death ray that will vaporize those two fuckers.

[Frustratedlady]

22. One of those is my retirement fund!!!!

Off with their heads!

I just found an article on the fund. I feel a little better, since it was "only" 2%, but the lawyers will eat that up.

http://www.kcci.com/money/18777061/detail.html

[Phoebe Loosinhouse]

23. What kind of person gets up every morning from their thousand dollar

Porthault sheets, snaps on their Rolex, waits for their car and driver, and thinks "I'm a sham. This is all a sham. My company is a sham, my profits are a sham. Muffy's breast implants are a sham, Buffy's sprayed on tan is a sham, the Cristal I drink at lunch is a sham, my Steiff Teddy bear collection(?)is a sham, my Saville Row suits are a sham. Some poor schmuck who drives a snowplow for the State of Pennsylvania is paying for it all! Bwahahahahahahahahaha!

[FKA MNChimpH8R]

27. Take these motherfuckers out into the field and

shoot 'em in the back of the head. Leave the bodies for the crows. Repatriate every nickel than can be found.

Sell their families into slavery as domestic servants in Saudi Arabia. I am not kidding.

PUNISH these parasitic, scumsucking assholes to the maximum to establish a real deterrent/warning.

What in the hell is wrong with a society that vomits up creatures like this? Well. that would be greed and Repigism....... Sorry.

[originalpckelly]

29. Summary execution? Oh that's nice.

They should be inside jail cells for life, but summary execution (or any execution) is unjust.

[avaistheone1]

33. Why only $1 million dollars bail when they stole $637 million?

These guys clearly have an incentive to run and hide, and plenty of money to do it with.

[mikelgb]

34. Poor Fellas. We should send them some TARP money.

[The Backlash Cometh]

35. A way of life.

[Quantess]

36. Another one!

Have there always been so many financial industry con artists, or has there been a recent spate of them?

[KamaAina]

37. It's harder to catch them when everything is going up

and everyone's (apparently) making money.

Then when the crash comes, all this comes out of the woodwork, like roaches do after a rainstorm.