I flew down to visit Mr. Israel after reading an advance copy of a book about him that is coming out in two weeks, “Octopus: Sam Israel, the Secret Market, and Wall Street’s Wildest Con” by Guy Lawson (Crown). I was riveted by Mr. Lawson’s telling of Mr. Israel’s bizarre conduct — sometimes genius and often sickening.
Here’s a quick recap of his sordid story: A native of New Orleans who is the grandson of a well-known commodities trader on Wall Street, he started Bayou Hedge Fund Group in 1996 and quickly became a rising star, amassing money from some of the most-respected investors on Wall Street based on the firm’s trading track record. Bayou traded through, among other firms, a unit of Goldman Sachs. There was only one problem: the firm’s profits were fictitious. Completely made up.