ST. PAUL, Minn. (AP) — A federal jury has convicted a Twin Cities hedge fund manager of misleading investors when he sent their funds to now-imprisoned Minnesota businessman Tom Petters.
James Fry was found guilty Wednesday on all 12 counts of wire and securities fraud, and of making false statements to the Securities and Exchange Commission.
The Star Tribune (http://bit.ly/194JOkG) reports Fry’s attorneys contended he believed Petters was running a legitimate electronic consumer goods business.
But prosecutors argued Fry hid from investors the relationship between Petters associate and convicted felon Frank Vennes Jr. and Fry’s Arrowhead Capital Management, and misled them about big-box retailers being the source of profits on their investments.
Petters was convicted in 2009 of orchestrating the $3.65 billion Ponzi scheme and is serving a 50-year prison sentence. He maintains his innocence.
Information from: Star Tribune, http://www.startribune.com