Iowa court accepts Wasendorf's guilty plea

Wed Oct 3, 2012 6:59pm EDT

Peregrine Financial Group's former Chief Executive Russell Wasendorf Sr. wears an anti-suicide tunic following his arrest on charges of lying to federal regulators in Cedar Falls, Iowa July 2012. REUTERS/Linn County Jail/Handout

Peregrine Financial Group's former Chief Executive Russell Wasendorf Sr. wears an anti-suicide tunic following his arrest on charges of lying to federal regulators in Cedar Falls, Iowa July 2012.

Credit: Reuters/Linn County Jail/Handout

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(Reuters) - A Federal court in Iowa on Wednesday formally accepted the guilty plea of Russell Wasendorf Sr., the chief executive of brokerage Peregrine Financial Group charged with bilking customers of more than $100 million in a 20-year fraud.

Chief judge Linda Reade accepted the guilty plea to four charges including lying to regulators, embezzlement and mail fraud, according to court papers. Wasendorf entered the plea in Cedar Rapids, Iowa last month.

Wasendorf, 64, remains in jail after prosecutors objected to a plan to release him into the care of a local pastor last month, saying there remains a "significant risk" he may try and flee.

Prosecutors have said Wasendorf, who faces up to 50 years in prison, should spend the rest of his life behind bars. Wasendorf's public defender argued for a sentence of about 24 to 30 years, which could be a life sentence given his age.

Wasendorf attempted to kill himself on July 9 near the headquarters of his Cedar Falls, Iowa, brokerage. He was arrested on July 13 and charged with 31 counts of lying to federal regulators.

The search continues for the money he stole. Former clients are still unable to access more than 60 percent of the funds frozen since the firm's bankruptcy on July 10.

A date for his sentencing has not yet been set.

(Reporting By David Sheppard in New York, additional reporting by Erin Smith; editing by Carol Bishopric)

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