Dreier

It turns out that the law firm that Marc Dreier created before his spectacular fall owned a lot of pretty good art. Now, the trustee who is overseeing the firm’s liquidation is asking bankruptcy court permission to auction those works. 

Ending a high profile action in one of the biggest Ponzi schemes in recent years, creditors of disgraced attorney Marc Dreier have voluntarily dismissed with prejudice a lawsuit they filed against his ex-wife, trying to hold her liable for some of his fraudulent behavior. 

An under-appreciated problem of substantial financial frauds is how they pit their victims against one another. Typically, the funds remaining after the fraud is uncovered are insufficient to make whole all of the numerous victims and creditors, who are left to squabble over who should get what.

Should the bankruptcy court overseeing the liquidation of Marc Dreier’s law firm give priority to clients who claim that Dreier stole settlement money from them on the ground that those settlement funds were never the law firm’s property? That’s the claim being made by Alston & Bird lawyers Craig Carpenito, Alexander S. Lorenzo, and John E. Stephenson, Jr. on behalf of Paul Gardi and Alex Interactive Media, LLC.

Welcome back, everyone!

The other day, we reported that a second person had pleaded guilty in the Marc Dreier fraud.

Can any single person engage in a massive fraud all alone, without any help?  If today’s development in the Marc Dreier case is any indication, the answer is probably not. 

Good morning! The day is just beginning, but it’s Friday and if you are looking for some weekend reading, consider this: The current issue of Vanity Fair has a very interesting and detailed article about Marc Dreier (you remember – the big scammer lawyer whose story was knocked off the front pages by revelations – five days later – of the Bernard Madoff Ponzi scheme).

The other day, U.S. District Court Judge Jed S. Rakoff entered an amended restitution order in the Marc Dreier case; the judge ordered Dreier to pay more than $388 million in restitution. The order is interesting for a number of reasons, including the schedule of  “victims” entitled to restitution.

Federal District Court Judge Jed Rakoff today sentenced disgraced attorney Marc Dreier to 20 years in prison – substantially less than the 145 years sought by the prosecutors – and ordered him to pay $387.7 million in restitution. The court’s decision follows Dreier’s decision to plead guilty in May to money laundering, conspiracy, securities fraud and wire fraud.