Weekend Economists Ride With Sally into the Sunset July 27-29, 2012

[Demeter]

30. Peregrine CEO faces hearing as jet, wine, condo to be sold

http://www.reuters.com/article/2012/07/18/us-peregrine-ceo-hearing-idUSBRE86H0OK20120718

Peregrine Financial Group CEO Russell Wasendorf Sr., who last week confessed to bilking futures traders of more than $100 million, returns to criminal court on Wednesday, JULY 18, as his receiver prepares to sell his jet, extensive wine collection and other assets that may have been bought with stolen money.

Wasendorf, the 64-year-old owner and founder of the failed Iowa-based brokerage, is to appear in federal court in Cedar Rapids for a bail hearing on Wednesday afternoon...In court Wednesday, Wasendorf will be represented by a public defender, according to Tom Breen, a Chicago lawyer that Wasendorf said he planned to hire. Breen did not take the job because Wasendorf's assets have been frozen.

CONDO, WINE FOR SALE

Meanwhile, Michael Eidelman, the receiver for Wasendorf in the bankruptcy of PFGBest, as his firm is known, is moving to secure the CEO's personal assets, including a $100,000 personal wine collection stored at myVerona, Wasendorf's high-end Italian restaurant in Cedar Falls, Iowa, Eidelman said in an interview. Other assets include a jet -- valued by brokers at $7 million to $10 million -- that is now parked at an airport in Waterloo, Iowa, and a condominium near downtown Chicago, valued by the county's property tax assessor at about $1 million. The condo will "go on the market pretty soon," Eidelman said. Wasendorf also owns a house just outside Cedar Falls worth close to $1 million, property records show.

"Upon information and belief, the assets owned by the Wasendorf Entities are diversified and include a restaurant, publishing company, aircraft and a construction company," Eidelman said in a motion Tuesday requesting that the court give him more power and funding to pursue and secure those assets.

"It is possible assets owned by the Wasendorf Entities may have been procured with funds embezzled from PFG," he said.

Eidelman asked the court for permission to employ the jet's pilot and myVerona's manager, as well as the chief financial officer at Wasendorf & Associates, which runs Wasendorf's now-closed publishing arm, to help him "identify, locate, secure, and take custody of the assets owned and controlled by Wasendorf Sr. and the Wasendorf entities."