Money | hedge fund Hedge Fund Fraud Gets 20 Years Samuel Israel denied leniency in $400M investor 'ponzi scheme' By Nick McMaster Posted Apr 14, 2008 4:45 PM CDT Copied Samuel Israel III, right, arrives at the United States Courthouse in New York, Monday, April 14, 2008. (AP Photo/Craig Ruttle) The founder of defunct hedge fund Bayou Group was given a 20-year prison term today for bilking investors out of more than $400 million, Bloomberg reports. Samuel Israel must also pay $300 million in restitution for masterminding a “ponzi scheme” in which investment returns were paid with new investors’ money. His sentence is the longest for a white-collar crime since Enron litigation. "You were, in every meaning of the sense, a career criminal … you ruined lives," US District Judge Colleen McMahon told Israel at sentencing. "Financial fraud, white-collar crimes are every bit as heinous as every other type of crime and they will be punished severely." Read These Next Gavin Newsom has filed a massive lawsuit against Fox News. White House rolls with Trump's 'daddy' nickname. Trumps ends trade talks with Canada. New York Times ranks the best movies of the 21st century. Report an error