[ by Melanie Gretchen ]

Peregrine Financial Group founder Russell Wasendorf Sr. pled guilty to his crimes on Monday, ending a 20-year scheme, but not the search for its ill gotten gains.  In a small courtroom in Cedar Rapids, Iowa, before Magistrate Judge Jon Scoles, the former CEO, 64, admitted to embezzling more than $100 million from customers of his futures brokerage, lying to regulators to cover his tracks, and mail fraud before.  Pending his sentencing, which has not been set, he will remain behind bars while Chief Judge Linda Reade of the U.S. District Court of the Northern District of Iow determines whether he is a flight risk.

Wasendorf was arrested on 7/13 and charged with 31 counts of lying to federal regulators.  Since then, prosecutors have argued in court that Wasendorf, who faces up to 50 years in prison, should spend the rest of his life behind bars.  In defense of the former futures-industry executive, Wasendorf's public defender have argued for a sentence of about 24 to 30 years, which could be a life sentence given his age.

Limited Access. Nevertheless, Judge Scoles had approved the release, on the grounds that Wasendorf's chances to flee were limited because he had surrendered his passport and assets to authorities.  His former clients also have limited access to their funds, frozen since the firm's bankruptcy on 7/10.  Although the total amount Wasendorf stole is not known, prosecutors contend that the former CEO stole about $200 million, echoed by the CEO, which has filed a lawsuit against Wasendorf and his firm.

Prosecutors said in a filing that "none of what defendant says can be taken at face value."

"If even the smallest portion of such a vast amount of money were hidden away, it could be all (the) incentive and means that defendant might need to flee a probable life sentence."

For further details, go to [Reuters, 9/17/12].