Peregrine Financial Group, Inc. founder Russell Wasendorf, Sr. bilked more than $215 million from clients of his firm, according to prosecutors. They are now seeking a 50-year sentence for Wasendorf, who pleaded guilty to charges of lying to prosecutors and mail fraud. Wasendorf is set to be sentenced Jan. 31.
A sentencing memorandum filed Tuesday indicates that Wasendorf claims his clients lost less than $200 million, although Sean Berry, Acting Iowa U.S. Attorney, said the amount clients actually lose “can be determined with remarkable precision.”
Wasendorf’s plea agreement indicated that he has been stealing from Peregrine for almost 20 years. The plea document said he used the money he stole for his own personal use, to pay for outside business interests and to help Peregrine’s financial position.
On Tuesday prosecutors argued that Wasendorf should spend the maximum amount of time in prison. Federal guidelines say he should receive life in prison. Prosecutors have asked the judge in the case to set the sentences on all four counts to run concurrently, adding up to 50 years. That would mean that Wasendorf would spend the rest of his life in prison if the judge agrees with prosecutors.
Wasendorf said he would pay complete restitution to the victims of his crimes, and the amount of that restitution adds up to $215.53 million. Government officials are currently working with Peregrine’s bankruptcy trustee to build a list of the names of those affected by Wasendorf’s fraud. The list will include those who held positive balances on July 9, 2012 in their Peregrine commodities futures accounts. Officials believe the list will contain more than 10,000 victims.