Tom Petters On Trial For $3.5 Billion Ponzi Scheme

Sketches and story by Ken Avidor

On September 29, 2008, Businessman Tom Petters was arrested for operating a Ponzi scheme that allegedly, fleeced investors out of $3.5 billion.

Tom Petters was held in Sherburne County jail for over a year while his attorneys and government attorneys made preparations for this week’s trial.

“U.S. vs Thomas J. Petters” finally got underway October 28th at the Federal Courthouse in Saint Paul, Judge Richard H. Kyle presiding.

Assistant U.S. Attorney Joseph T. Dixon III read a summary of the charges and the evidence the prosecution will present in his opening statement. Dixon played some audio clips from recorded conversations with Tom Petters speaking with associates. Joe Dixon pointed to Tom Petters and assured the jury that the prosecution would prove Tom Petters was guilty of fraud

Defense attorney Jon Hopeman said Petters was innocent and it was Deanna Coleman and other Petters’ associates who were responsible for the fraud. In Hopeman’s words they were , “instruments of darkness and doers of foul, foul deeds”.

The second day of the trial began with Assistant U.S. Attorney John Marti questioning witnesses who became involved in Tom Petters’ complex web of financial dealings. Witnesses testified how the scheme almost unraveled in 2000 when phony purchase orders were used to borrow large amounts of money

On the third day of the trial, Gregg Colburn of the Interlachen hedge fund told how Interlachen lost $60 million when Petters was busted by the Government in September 2008.

Next week, Deanna Coleman former Petters associate is expected to testify.

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