Feds release documents on Petters raid

Categories: Tom Petters

TomPetters.jpg
Court documents released Friday after the raid of Tom Petters' home and business headquarters Wednesday show a major fraud investigation in what could be a long fight for the self-made millionaire.

Petters has yet to be charged or arrested, but the search warrants show an elaborate fraud that could be upwards of $2 billion. To catch up on the story, read our previous Blotter entries last week and then read the details after the jump.

According to the Star Tribune, Petters said through his lawyer that he is innocent and will fight any charges that arise from the investigation:

In a search warrant filed in federal court in St. Paul, the FBI describes Petters as the key figure in a high-stakes fraud scheme that began in the mid-1990s and continues unabated.

Scores of agents herded employees of Petters Group Worldwide into the company's Minnetonka cafeteria, told them to turn off their cell phones, then escorted them from the property. Petters was out of town and had to quickly fly back to the Twin Cities.

In the meantime, agents with the FBI, the U.S. Postal Inspection Service and the IRS criminal investigative division worked from morning into the evening and left with trucks and vans packed with paper and electronic documents. A stunned business community could only wonder what it was all about.

And the nitty gritty to top it off?

One of Petters' associates was secretly recorded saying the fraud exceeded $2 billion. The affidavit says Petters and a handful of associates enticed investors into deals that were allegedly secured by retail products. But there were no products and the purchase and sale of those products was fictitious, according to the government.

Whoops. Who let the cat out of the bag?

Petters is also the board chairman of Sun Country Airlines, which the Star Tribune reports is taking steps to get as far from him as possible:

"My goal is to become financially independent and not seek any additional cash from Petters Group Worldwide for the rest of this year," Sun Country CEO Stan Gadek said. "I'm confident that Sun Country will be able to achieve that goal."

We can't rush to any judgment just yet... The guy hasn't been arrested or charged for a single thing. But seriously. Isn't $2 billion stretching your luck a little too far?



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