Fund manager who faked plane death lands in jail

Indiana ex-fund manager Marcus Schrenker, who tried to fake his death and elude investigating authorities by crashing his own plane, was given a 10-year state sentence for fraud.

“I’m so sorry. I’m so sorry,” Schrenker, 39, told Indiana Superior Court Judge Steven R. Nation in a Noblesville, Indiana courtroom. “I let my assets control me.”

His term is to run consecutively with a four-year federal sentence imposed last year for crashing his plane and sending a false distress call. Nation affirmed a deal Schrenker made with prosecutors in August after pleading guilty to five counts of fraudulently selling securities. (View the updated Fraud Charge Tracker).

The president of Heritage Wealth Management in Indianapolis, Schrenker was under investigation when he flew his Piper model PA46-500TP plane on Jan. 11, 2009, from Indiana and bailed out over southern Alabama.

The plane crashed in the Florida panhandle.

Law enforcement officials found him at a campground near Quincy, Florida, bleeding from gashes in his arms. Schrenker said in a letter later he was on the way to Destin, Florida, to visit his father when he jumped and retrieved a motorcycle he had put in a storage unit.

Schrenker’s lawyer, P. Chadwick Hill of Indianapolis, today told the court his client suffered from stress, bi-polar disease and reliance upon drugs and alcohol.

Hamilton County Chief Deputy Prosecutor Jeffrey Wehmueller countered that that was no excuse.

“Many people have stress and don’t commit crimes,” he said.

Under the plea agreement, Schrenker is required to pay restitution in excess of $610,000.

One of his victims, Charles William Black, told the court he had lost his children’s $15,000 college fund to Schrenker’s scheme.

Black said that while he, as a Christian, forgave Schrenker, “Christian principles require that you don’t condone crimes like this and that you have to pay for them.”

Schrenker’s attempt to fake his death fits a pattern for some financial executives faced with collapsing companies and tightening investigations.

A day after Schrenker’s arrest, Florida hedge-fund manager Arthur Nadel was reported missing, having left a note indicating he planned suicide after authorities began investigating complaints about missing investor money. Nadel, caught after two weeks on the lam, pleaded guilty to fraud in February. He had overstated the money he managed by more than $350 million.

Hedge fund manager Sam Israel, convicted in a $400 million fraud scheme, was to start a 20-year prison sentence in June 2008 when he abandoned his car with “suicide is painless” written in dust on the hood. Three weeks later, after hiding out in a Springfield, Massachusetts, campground, he surrendered to police.

White-collar criminals are generally narcissistic and “begin to believe their own mythology,” Harvard University neuropsychologist Donald Davidoff said in an interview last year.

When someone whose personality is tied to wealth and power is disgraced, the experience produces “dissolution of their personality,” Davidoff said. “They run not because of the threat of arrest but a loss of self.”

Related Topics: Fraud Charge Tracker