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Former Peregrine CEO Pleads Not Guilty in $200 Million Fraud Scheme

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CEDAR RAPIDS, Iowa - Former Peregrine Financial Group founder and chief executive Russell Wasendorf Sr. pleaded not guilty to 31 counts of reporting false financial statements to regulators regarding more than $100 million customer funds he admitted to stealing over 20 years in federal court Friday.

Wasendorf, 64, of Cedar Falls, appearing in an orange jumpsuit and in hand and leg shackles, told a U.S. Magistrate he pleaded not guilty to 31 counts of making and using false statements. None of Wasendorf's family attended the brief hearing.

U.S. Magistrate Jon Scoles set his trial Oct. 15. A status conference will be at noon Sept. 19.

If convicted, Wasendorf faces up to 155 years in prison and a $7.7 million fine.

According to the indictment filed Monday, Wasendorf on 31 occasions between February 2010 and June 2012 caused false year-end financial statements and monthly reports to be submitted to the Commodity Futures Trading Commission and overstated the value of customer funds by at least tens of millions of dollars, which he knew was far less.

Wasendorf admitted in a suicide note that he stole more than $100 million from customer funds for more than 20 years, according to court documents.

"I was able to conceal my crime of forgery by being the sole individual with access to the US Bank accounts held by PFG," Wasendorf wrote in a suicide note to his wife and son that was included in the criminal complaint against him.

Black Hawk County Sheriff's deputies were called to a suicide attempt report at the Peregrine headquarters in July and found Wasendorf unresponsive in his car, which had a tube hooked to its tailpipe, according the criminal complaint.

Wasendorf said in the note and signed statement he was in financial trouble and had choose between going out of business or cheating.

Wasendorf explained in the note how he made forgeries of bank statements and how he went about covering up the scheme.

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