October 28, 2015 / 8:22 PM / 4 years ago

N.Y. lawyer who admitted fraud in would-be suicide note pleads guilty

NEW YORK, Oct 28 (Reuters) - A New York lawyer pleaded guilty on Wednesday to running a $5 million Ponzi scheme that he detailed in a suicide note authorities discovered after rescuing him from his jump into the Hudson River last year.

Charles Bennett, 57, pleaded guilty in Manhattan federal court to securities and wire fraud, nearly a year after he attempted suicide, leaving behind the note in which he admitted defrauding friends and family through a scheme he called a “fiction of my crazed imagination.”

“I am deeply, deeply ashamed by my conduct,” Bennett said in court.

His sentencing was set for March 17.

Bennett began the scheme in 2008, luring 30 investors with promises of up to 25 percent returns and misleading claims that a New York State governor and his then-wife were also investors, according to prosecutors and regulators.

The description of the governor matched that of former New York Governor Eliot Spitzer, whose ex-wife Silda Wall Spitzer at the time of Bennett’s arrest confirmed she once worked with him at the law firm Skadden, Arps, Slate, Meagher & Flom.

The investment fraud came after Bennett launched his own law practice in 2001, the U.S. Securities and Exchange Commission said in a complaint.

As part of the scheme, Bennett told investors he had a relationship with a Wyoming fund manager and could arrange for investments in his fund, authorities said.

But Bennett never invested the money and instead used it for his own benefit and to repay investors, authorities said.

His November 2014 suicide attempt came after investors began demanding repayment, prosecutors said.

Police officers recovered a note signed by Bennett entitled “A Sad Ending to My Life.” In it, he confessed that he “managed to completely squander the hard-earned money” of his family and friends, according to court documents.

“It was all an illusion - again not one trade was ever done,” Bennett wrote, charging documents said. “It was a Ponzi scheme pure and simple.”

The case is U.S. v. Bennett, U.S. District Court, Southern District of New York, No. 15-00020. (Editing by Matthew Lewis)

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