Petters to remain in jail; Feds had no idea of scheme until whistleblower called

[Robbien]

Source: Pioneer Press

In 1994, Petters created Petters Co. Inc. That company's purpose, colleagues now say, was to support Petters' lifestyle and fund his other entities with proceeds from a fraud scheme launched in 1995.

That alleged scheme began to unravel last month when Deanna Coleman, 42, vice president of operations at Petters Co., approached authorities and revealed the workings of a Ponzi scheme that prosecutors say succeeded in swindling investors and lenders out of billions of dollars.

. . .

White and federal prosecutors explained in court how he became caught up the scheme. Sometime in 1998, he said, Petters asked him to create a false bank statement that would be used to convince lenders that the transactions in which they were investing or loaning money for were legitimate. White complied and joined the Petters organization shortly thereafter, he said. The information for the falsified statement came from Coleman, White said.

After White joined Petters Co., he soon learned that all the loans obtained by the company were obtained with false information, he said. Between the time White joined the company and last month, when Coleman went to federal investigators, he said, the amount of debt from loans obtained by fraud had grown from $100 million to more than $3 billion.

. . .

On Wednesday afternoon, Michael Catain explained where some of the money went. Catain, 52, of Shorewood, ran a sham company called Enchanted Family Buying Co. in Excelsior, which purportedly sold "electronic merchandise." According to court documents, when investigators visited the address listed for Enchanted Family, they found a paint store next to a car wash.

Catain admitted in court that he routed $12 billion through an account for Enchanted Family at Anchor Bank from 2002 to 2008. He took commissions totaling about $3 million.

Read more: http://www.twincities.com/allheadlines/ci_10673157

---

These are probably amoung the type of phony instruments that Paulson wants the Feds to buy and take off the banking industries' books. Is it any wonder banks don't trust each other enough to loan each other money.

The entire article is full of interesting details, worth a click through.

[happygoluckytoyou]

1. PETTERS? sounds pretty REPUBLICAN to me, what do you think Larry Craig?

[Robbien]

3. Nevada Gaming reported that Petters has gambling losses exceeding $10 million

It says Petters "is the largest comped-room guest" at the upscale Bellagio Casino in Las Vegas.

Even with this indictment, Petters kept spending money. The court had to issue a restraining order against him:

Montgomery acted at the request of the U.S. attorney's office, which sought a temporary restraining order and a permanent injunction against Petters and his associates. In her order, Montgomery said prosecutors had sufficient "probable cause" to believe that the defendants would continue to commit financial crimes without a restraining order.

"Weighing the equities and considering the United States' likelihood of success in its cause of action, this Temporary Restraining Order is in the public interest," Montgomery wrote in an order that was signed Friday and kept under seal until Monday while parties were notified.

http://www.startribune.com/templates/Print_This_Story?sid=30530209

This guy is pure greed.
Wonder if the guy standing next to him at the gaming tables is one little known politician known as McCain, the POW.

[truthisfreedom]

2. Someone should find out who these people were contributing to.

[Robbien]

4. Faith based foundation a big recipient of Petters money

Fidelis Foundation which is a fundy faith based organization not only received big money from Petters, it holds a big investment in Petters Co.

Fidelis Foundation of Minneapolis holds $27.6 million in Petters Co. notes that may ultimately be worthless.

Type of work Fidelis does:

This past weekend I was in Minneapolis for the 2008 Desiring God National Conference. . . We had the opportunity to attend a pre-conference meeting sponsored by the Fidelis Foundation at Bethlehem Baptist Church. Our speaker was Dr. Don (D.A.) Carson. Dr. Carson spoke on "Five Trends in the Church Today".

http://mrclm.blogspot.com/2008/09/desiring-god-national-conference-2008_30.html
--------------

This is one of the most thoughtful, pastoral messages I’ve heard on the value of strong, theological, male leadership in the church. John Piper argues compassionately for the church to move not only from female leadership, but also feminised flavored worship services. One of the remarkable points John unpacks is that many women in leadership are craving for male leadership. Delivered at the Fidelis Foundation Pastor’s Luncheon. The structure of the message is 11 reasons why we should value Biblical manhood.
http://faithbyhearing.wordpress.com/2007/10/27/some-sweet-blessings-of-masculine-christianity/

[LuckyLib]

5. This will be found to have been one of he all-time great pyramid schemes.

It would have unraveled eventually, but the execs were all living high on the hog (corporate leadership, anyone?) -- they have tapes of him saying "Hell no, the paper is all fake!" Petters knew it was only a matter of time. Hopefully the whole damned group will go to jail. Innocent folks are losing their jobs left and right.