UPDATE 1-Hedge fund swindler Israel denied bail, jailed

Tag : Sweat Pants

(Adds details of hearing, description of Israel)
NEW YORK, July 3 (Reuters) - Hedge fund swindler Samuel Israel IIIfaced a fresh charge of bail jumping on Thursday and was ordered tojail immediately, one day after his mother convinced him to end ahigh-profile run from justice.
Israel, who faked his own death nearly four weeks ago to avoid a20-year prison sentence for cheating investors out of $450 million,was denied bail by Judge Colleen McMahon in federal court inManhattan. He will likely face additional prison time for havingfailed to show up at a Massachusetts prison on June 9.
McMahon originally sentenced Israel in April but allowed the manwho engineered the $2 trillion hedge fund industry's most brazenscam ever to remain free for weeks so that prison officials couldget the medications he needs ready.
Flanked by two lawyers, the 48-year old co-founder of Bayou Grouphedge fund was dressed in a blue T-shirt and sweatpants and smiledand waving to someone in the courtroom.
Israel, who has a pacemaker and was addicted to prescription painkillers to relieve chronic back pain, told the court he tried tocommit suicide by swallowing pills two days ago. "I thought it wasbetter to do myself in than to turn myself in."
When that attempt failed however, Israel said he thought God hadwanted him to surrender. This and his mother's pleas, made himleave the campground where he had been hiding out in a mobile homeand ride his blue scooter to the nearest police station inSouthwick, Massachusetts, officials have said.
Last month Israel briefly duped police into thinking he had killedhimself by having abandoned his car on a New York bridge above theHudson River with the words "suicide is painless" scrawled on thehood in dust. With no body however, police quickly realized thatIsrael was a fugitive and spent thousands of hours searching forhim around the country.
A grand jury is expected to hand up an indictment in the next 30days, and Israel did not enter a plea on Thursday. (Reporting byPaul Thomasch and Matt Daily in New York, with additional reportingby Svea Herbst-Bayliss in Boston; editing by Gerald E. McCormickand Dave Zimmerman)