Great frauds in history: Samuel Israel and Bayou Group

Samuel Israel's investment returns weren't all that they appeared to be as investors learnt to their cost.

Samuel Israel III, center, arrives at U.S. District Court in UNITED STATES
(Image credit: Bloomberg / Contributor)

941-Israel-634

Samuel Israel: couldn't be the market

Born in Louisiana in 1959, Samuel Israel came from a stockbroking family. His grandfather founded a commodities firm that was sold for $42m in 1981. Despite failing to graduate from university, Israel's family connections ensured he got a job as a junior trader at several Wall Street firms, including a minor role at the hedge fund Omega Partners, run by the billionaire Leon Cooperman.In 1996 he set up the Bayou Group, a hedge fund that claimed it had developed a unique trading system that could turn $300m into $4bn within a decade.

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Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri