Yesterday, Samuel Israel III, the former CEO of defunct hedge-fund
Bayou Management, was supposed to begin serving a 20-year prison term
for fraud. Today, New York State police are investigating the possible
suicide of Israel, according to a report by Dow Jones Newswire’s Chad Bray.
Bruce Cuccia, a state police senior investigator, said Israel’s SUV
was found yesterday afternoon, parked unattended with the keys in the
ignition on the Bear Mountain Bridge in Westchester County. The bridge
crosses the Hudson River at one of its deepest points, Cuccia said. No
suicide note was found, but written in the dust or pollen on the hood
of the vehicle was, “Suicide is painless” — an apparent reference to
the “M.A.S.H.” theme song. No body has yet been recovered.
Bayou claimed it had more than $400 million in assets in July, 2005,
when it abruptly closed its doors. At the time, Israel told clients
that the fund was solvent but that he wanted to spend more time with
his children due to his divorce. One worried investor flew from the
West Coast to meet with the hedge fund’s CFO, Daniel Marino. But the
waterfront cottage where Bayou had its offices was empty, and inside on
Marino’s desk, the investor found a letter that began: “This is my
suicide note and confession.” The letter asserted that Marino, along
with Israel and a former partner named James Marquez, had “defrauded
all these investors.”
A federal investigation concluded that investors in Bayou
collectively lost more than $400 million. Israel and Marino each
pleaded guilty in September, 2005 — to conspiracy, investment adviser
fraud and mail fraud charges — and both received 20 years. Marquez was
sentenced to 51 months.
Israel was supposed to surrender at a federal prison in Massachusetts at 2 p.m. on Monday to begin serving his sentence.
Source
