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Bayou Fraud Claims Another Man
Saying nothing can cost a lot. Matthew Marino is about to find out how much.
Marino is a lawyer and the brother of Daniel Marino, the chief financial officer of the Bayou Group hedge fund, which collapsed in scandal in 2005. Daniel Marino and C.E.O. Samuel Israel III admitted their fraud shortly thereafter and were sentenced to long terms in federal prison earlier this year.
Turns out that Matthew Marino helped his brother conceal the fraud. Prosecutors say that he helped set up and run the phony auditing firm Bayou used to persuade investors that their money was safe. He also helped to hide the fraud from lawyers representing Israel's ex-wife in a divorce proceeding.
Marino acknowledged his guilt yesterday before U.S. Magistrate Judge Lisa Margaret Smith in federal court in White Plains, New York. She is scheduled to sentence him on December 4.
Marino faces as much as three years in prison, a fine of $250,000, and the prospect of being on the hook to return as much as $300 million to investors.
by Mark Stein
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