In a surprise twist in the trial of Michael Mendelson, one of the two managers of the collapsed hedge fund Portus Alternative Asset Management, he reached a plea agreement by pleading guilty and testifying against his former partner, Boaz Manor, the Edmonton Journal reports. Still, Mendelson was sentenced to two years in prison.
Mendelson apologized for defrauding 26,000 investors of $761 million, saying to Ontario Court of Justice Judge Robert Bigelow, “I want to say, your honor, to anyone negatively impacted by the creation of Portus that I deeply apologize.”
Bigelow evidently took some pity on Mendelson, noting that he had received numerous character letters on his behalf. The judge said the former hedge fund manager “has clearly accepted responsibility for what has occurred. The likelihood that [Mendelson] will be before the courts again is almost nil,” the judge said.
The investors will get approximately 96% of their money back. Mendelson pocketed nearly $23 million from the fund, $17 million of it in cash and diamonds that have not been found.