After a bizarre series of events that included allegedly faking a serious car accident and assuming the identity of two female sales assistants, a New York Naval Academy graduate was indicted on charges he masterminded a Ponzi scheme that swindled friends and former classmates out of at least $1.2 million. Bryan Caisse, 50, was charged by New York criminal authorities on four counts of Grand Larceny in the Second Degree, six counts of Grand Larceny in the Third Degree, and one count of Scheme to Defraud in the First Degree. Caisse, who fled to Colombia back in October 2013 after authorities executed a search warrant on his apartment, was arrested in Bogota this past weekend and returned to the United States.
According to authorities, Caisse began soliciting family and former classmates in April 2008, telling them he was starting a hedge fund, Huxley Capital Management, and was seeking so-called working capital loans to cover short-term expenses until larger investors filled that void. These were short-term loans ranging from one to two years, and promised annual rates of return of 8%. Investors were drawn to Caisse as a result of his history as a former bond salesman and trader with now-defunct Bear Stearns. In total, Caisse raised approximately $1.2 million from at least 20 family members and former classmates.
However, Caisse's promises of forthcoming deep-pocketed investors soon fell through. After the New York District Attorney’s Major Economic Crimes unit conducted an investigation, authorities alleged that instead of using the money to pay hedge fund expenses, Caisse spent investor funds on a variety of personal expenses that included rent, car services, tuition for his daughter's private school, and even $10,000 on a dating service.
Investors that attempted to recoup their investment from Caisse encountered a variety of setbacks in their quest. This included:
- Claims that Caisse's bank, HSBC, could not wire funds except to another HSBC account;
- Communications with Caisse's assistant, Kristy Smith, who would not speak on the phone because of her poor English;
- Communications with another assistant, Christine Woo, who also refused to speak on the phone and eventually stopped communicating;
- Representations to investors that Caisse had been in a horrific car accident that caused him brain damage and a broken hip; and
- Numerous checks being lost in the mail.
A New York judge set Caisse's bail at $3 million.
For an extremely in-depth look into Caisse's story, see the Southern Investigative Reporting Foundation's article here.