Legal News

Marc Dreier Likely Returning to the High Life (With Guards, of Course)

By Nathan Koppel

The Marc Dreier matter is rounding into focus (and so is our Marc Dreier-related “art.” Banished forever, alongside the ECOLI license plate, is this picture of Dreier).

Yesterday, prosecutors filed this document disclosing the financial firms that allegedly were taken by Dreier, who was indicted last month for selling fictitious promissory notes.

The court filing lists 20 organizations that supposedly are owed money, and it includes names that had not yet surfaced, such as Concordia Advisors LLC; Meyer Venture Partners LP and Context Capital Management. A spokesman for Concordia Advisors, based in New York, confirmed that “certain funds under Concordia Advisors’ management were victimized in this case. We are cooperating with all of the authorities involved in the investigation.”

Meyer and Context did not return calls for comment.

The court filing, alas, is short on detail; it doesn’t list the amounts the funds invested in Dreier’s fraudulent scheme or which funds were able to get their money back from him; however, at least some of them were successful in being repaid.

The list of alleged victims also includes New York asset manager GSO Capital Partners LP, now owned by Blackstone Group LP, and Fortress Credit Corp. Fortress did not return a call. Dreier sold $100 million in purported notes to GSO, starting in early 2006, but debt was repaid with interest, and GSO has no exposure, according to a person familiar with the transaction.

Gerald Shargel, counsel to Mr. Dreier, has said his client hopes to achieve a “fair and appropriate resolution of the matter.”

Separately, New York federal judge Jed Rakoff issued an order setting out the conditions that Dreier must meet to be free on bail, including shelling out more than $200,000 to pay for armed security guards who will be stationed at his Manhattan apartment.

The order offers a further glimpse of what it’s like to be under house arrest, Dreier style. The security firm will question all visitors to Dreier’s apartment; will take custody of all cell phones, Blackberrys, and computers; and will use reasonable force, if necessary, to avoid flight.

Full post as published by Law Blog - WSJ.com on February 10, 2009 (boomark / email).