Israel’s Girlfriend Sentenced to 3 Years’ Probation

Date: Wednesday, June 10, 2009
Author: Bloomberg.com

Debra Ryan, the girlfriend of Samuel Israel, convicted for his role in a $400 million fraud involving the collapse of hedge-fund firm Bayou Group LLC, was sentenced to three years’ probation for aiding his escape.

Ryan was also ordered to be confined at home for four months and not to have any contact with Israel, said Herb Hadad, a spokesman for the U.S. Attorney Lev Dassin in New York.

Israel, 49, pleaded guilty in March to faking his suicide by abandoning his car on an upstate New York bridge with the words “suicide is painless” written on the windshield and fleeing the day he was to begin a 20-year sentence. He pleaded guilty to fraud in 2005 after admitting he hid $400 million in losses at Connecticut-based Bayou.

“The night before his surrender, Sam woke me up and begged me to help” him escape, Ryan told U.S. District Judge Kenneth Karas in pleading guilty Feb. 10 in White Plains, New York. “I knew that was wrong.” Karas sentenced her today.

Ryan, 46, of Armonk, New York, was arrested on June 19, 2008, and charged with aiding and abetting Israel. She admitted she met him at an auto-repair shop in Bedford, New York, on June 7 to help him attach a motor scooter to a hydraulic lift on the back of a recreational vehicle, prosecutors said. She also helped him pack the RV with the belongings and gave police a suicide note written by Israel, according to court papers.

Ryan faced a maximum sentence of 10 years in prison.

‘Horrible Ordeal’

“This has been a horrible ordeal for Ms. Ryan and she is glad it is finally behind her,” Richard Strassberg, Ryan’s lawyer at Goodwin Procter LLP in New York, said in an e-mailed statement. He called the judge’s approach to the sentencing “thoughtful and balanced.”

Israel disappeared on June 9, the day he was to report to the Devens federal prison in Massachusetts. Within a week, state and federal authorities ruled out suicide and started an international manhunt.

Israel surrendered to police in Southwick, Massachusetts, in July, three weeks after his car was found. He forfeited his $500,000 bail and faces as long as 10 additional years in prison for bail jumping.

He’s scheduled to be sentenced for the bail-jumping charge on July 15.

The cases are U.S. v. Ryan, 09-cr-26, and U.S. v. Israel, 08-cr-00723, U.S. District Court, Southern District of New York (White Plains). Israel’s fraud case is U.S. v. Israel, 05-cr- 1039, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Thom Weidlich in New York at tweidlich@bloomberg.net.