Wall Street scion
Caspersen gets 4 years in prison for $38.5 million fraud
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[November 05, 2016]
By Nate Raymond
NEW
YORK (Reuters) - Former Wall Street executive Andrew Caspersen was
sentenced on Friday to four years in prison for engaging in what
prosecutors say was a Ponzi-like scheme to defraud investors including
family members and friends out of $38.5 million.
Caspersen, who worked at a unit of investment banker Paul Taubman's PJT
Partners Inc before his arrest in March, was sentenced by U.S. District
Judge Jed Rakoff in Manhattan after pleading guilty to charges including
securities fraud.
Prosecutors sought up to 15-2/3 years in prison for the Princeton
University and Harvard Law School graduate, who they said for 18 months
shamelessly exploited his victims' trust.
But Paul Shechtman, his lawyer, urged Rakoff to consider as a mitigating
factor Caspersen's "pathological" gambling addiction that led him to
obtain millions of dollars to engage in risky options trading.
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"I was willing to do anything to continue, and eventually I did,"
Caspersen, 40, said in court.
After hearing from testimony from an expert in gambling addition, Rakoff
agreed Caspersen's condition impacted his decision making. He called the
lengthy prison term prosecutors pushed "absurd."
"No purpose will be served by letting him rot in prison for years on
end," said Rakoff, who is expected to order restitution at a later date.
Caspersen, the son of late Wall Street financier Finn M.W. Caspersen,
had worked at Park Hill Group since 2013. The advisory firm was spun off
from private equity group Blackstone Group LP last year and is now part
of PJT Partners.
Prosecutors said beginning in 2014, Caspersen sought to defraud over a
dozen investors including his mother, a brother and friends by claiming
he would use their funds to make loans to private equity firms,
generating annual returns of 15 to 20 percent.
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![](../images/110516pics/busine81.jpg)
Andrew Caspersen and his wife Christina Caspersen depart following
his sentencing at the U.S. Federal Court in New York City, U.S.,
November 4, 2016. REUTERS/Brendan McDermid
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Instead, prosecutors said he used the $38.5 million he raised to make
options trades, to pay earlier investors and to replace over $8 million
he misappropriated from Park Hill, which Caspersen said during his July
guilty plea he used for gambling.
In total, he tried to raise over $150 million, prosecutors said.
His victims included a foundation affiliated with hedge fund Moore
Capital Management and one of the fund's employees, who together were
cheated out of $25 million, prosecutors said.
He was arrested in March at a New York airport after returning from a
trip to Florida. Just before that, he had drafted a suicide note to his
wife and letter to his creditors saying he was "deeply ashamed," court
papers said.
The case is U.S. v. Caspersen, U.S. District Court, Southern District of
New York, No. 16-cr-00414.
(Editing by Matthew Lewis, Bernard Orr)
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