Hedge funders charged in a $1 billion fraud allegedly emailed about fleeing the US

Several employees of a troubled New York hedge fund, Platinum Partners, were arrested earlier on Monday on charges of participating in an approximately $1 billion fraud.

Mark Nordlicht, Platinum’s chief investment officer, Uri Landesman, a Platinum marketer, and another co-conspirator
allegedly sent emails about fleeing the US, according to a government indictment out Monday.

This is how it went down, according to the charges. On or about December, 13, 2015, Nordlicht, Landesman and an unnamed co-conspirator sent emails “that contemplated Nordlicht and Co-Conspirator 1 fleeing from the United States and illustrated their knowledge and awareness of the fraudulent scheme perpetrated on Platinum’s investors and prospective investors.”

The unnamed co-conspirator sent the following email to Nordlicht, according to the indictment: “Don’t forget books. Assume we are not coming back to ny[.] Just to be safe. Depends on Miami[.] We can fly straiggt [sic] to europe from miami on Tuesday[.] Take passport.”

In response, Nordlicht asked for $2.5 million to pay off the firm’s brokers and said he was ready to take $7.5 million from a second mortgage on his house to deal with the hedge fund’s liquidity crisis, the indictment says. Later he sent another email to the unnamed conspirator.

“Am on my way to jfk with kids for their 6 pm flight to Israel,” Nordlicht’s email read, according to the indictment. “[My wife] is literally making me get on Israel flight if we don’t connect and agree what we are doing.”

Nordlicht then forwarded the email exchange to Landesman, according to the indictment.

Landesman responded, according to the indictment: “You should get on the flight if there is no bridge [loan], probably even if there is…We need to go through the mehalech of how we are going to share this with clients and employees, going to be very rough, big shame.”

“Mehalech” in Hebrew, roughly translated, means overview or process.

About two months later, Landesman told an investor via email that Platinum was “sound” and that he “hope[d] to be beyond liquidity concerns forever by end of May, we welcome your further investment.”

A spokesman for Platinum declined to comment. Lawyers for Landesman and Nordlicht could not immediately be reached.

You can read the relevant excerpt from the indictment below.

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