Greek police arrest former hedge-fund president wanted in U.S. for $27 million fraud

Date: Monday, August 20, 2007
Author: Associated Press

ATHENS, Greece: A fugitive former hedge-fund president sought in the U.S. for $27 million fraud was arrested on Crete Monday on an international warrant, police said.

Police said Angelo Haligiannis, 35, former president of hedge fund Sterling Watters, was arrested while holidaying at the northern Hersonissos resort, near the city of Iraklio, after a tip-off from a man claiming to have been one of his victims.

"The suspect was arrested this afternoon on a U.S. warrant for fraud, and is being held," said Iraklio police chief Pantelis Giannakopoulos. "We detained him and Interpol confirmed that he was wanted," he told The Associated Press.

A Hersonissos police spokesman said Haligiannis was detained after another vacationer recognized him and contacted authorities.

Haligiannis pleaded guilty to criminal fraud charges in a New York court in September 2005, but failed to appear for his sentencing in January 2006.

The court found that Sterling Watters Group and Haligiannis systematically defrauded investors by misrepresenting the fund's performance since 1996. The summary judgment found that the fund distributed materials indicating it held US$180 million in assets when, in fact, it had less than $170,000.

The ruling followed a civil lawsuit by the U.S. Securities and Exchange Commission, which accused Haligiannis of fraudulently raising at least US$27 million from investors.

Haligiannis will face a prosecutor on Tuesday, police said. U.S. embassy officials in Athens were not available for comment.