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Hedge Fund Managers Plead Guilty In Petters’ Case

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(credit: Hennepin County Jail)

(credit: Hennepin County Jail)

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MINNEAPOLIS (AP) — Two Florida hedge fund managers have pleaded guilty to lying to investors about investments in convicted Minnesota businessman Tom Petters’ former company.

David Harrold and Bruce Prevost each pleaded guilty Thursday to four counts of securities fraud.

Prosecutors accused Harrold and Prevost of giving false information about Petters Co. Inc. to investors. They were indicted Wednesday along with former Petters associate Frank Vennes.

Vennes, who also lives in Florida, also is charged with money laundering. He has not entered a plea.

Prosecutors alleged Harrold and Prevost falsely told investors PCI was generating profits. Petters is serving a 50-year sentence after being convicted of orchestrating a $3.7 billion Ponzi scheme through PCI. Petters is appealing.

Sentencing for Harrold and Prevost has not been scheduled. They each face up to 20 years.

(© Copyright 2011 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

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