Girlfriend Faces a New Charge in the Bayou Fund Swindle

Date: Thursday, January 15, 2009
Author: Associated Press

The girlfriend of the convicted hedge fund swindler Samuel Israel III, already accused of helping him skip out on a prison sentence, tried to send him $300 in jail, officials said Wednesday.

The cash was “secreted in the pages of a magazine” mailed to Mr. Israel last month at the Westchester County Jail, a county police spokesman, Kieran O’Leary, said.

The money was discovered during routine screening and did not reach Mr. Israel, Mr. O’Leary added. Prisoners are not permitted to receive cash.

The magazine was traced to the girlfriend, Debra Ryan, 45, of Armonk, N.Y., and she was arrested on Friday, Mr. O’Leary said. She is to appear in a local court later this month.

The arrest was first disclosed in federal court after Ms. Ryan pleaded not guilty to the original charge, that she had helped Mr. Israel evade authorities rather than begin his 20-year prison sentence last June.

Mr. Israel surrendered a month later and was recently transferred to a federal medical prison in Massachusetts for physical and psychological tests ordered by Judge Kenneth Karas of Federal District Court. The judge is unsure that Mr. Israel, who has been addicted to painkillers, is competent to plead guilty to the charge of failing to report to prison.

Ms. Ryan’s lawyer, Richard Strassberg, declined to comment on the contraband charge, which is a misdemeanor with a maximum one-year sentence upon conviction. She could face up to 10 years in prison on the original charge.

The judge warned Ms. Ryan to have “no contact of any kind” with Mr. Israel in the future and added that to the conditions of her $75,000 bail.

“Ms. Ryan, please don’t tempt fate,” he added.