Andrew Caspersen, a former Wall Street executive, pleaded guilty to federal charges that he defrauded investors of nearly $40 million. <\/p>\n
Caspersen, accompanied by his attorney, pleaded guilty in a Manhattan federal courtroom to one charge of wire fraud and one charge of securities fraud, each of which carries a maximum penalty of 20 years in prison. Caspersen\u2019s attorney argued that his gambling addiction and mental illness caused him to commit the fraud.<\/p>\n
Caspersen raised money from friends, family members and other investors and used it to trade one-week put options, betting against the Standard & Poor\u2019s index and often instructing his broker to trade all the cash in his account each week. According to news reports, that account held $112.8 million as recently as February 1, which would have been more than enough to pay back Caspersen\u2019s investors. However, he continued to make all-in bets against the market.<\/p>\n