A former Deutsche Bank AG and American International Group Inc. managing director and her husband have been indicted for fraud for allegedly conspiring to illegally extract money from those companies to help run their upstate New York horse farm.
According to a grand jury indictment filed Tuesday in Manhattan federal court, the defendant Heidi Walker arranged for Deutsche Bank to pay $345,000 and AIG to pay $125,000 to companies run by her husband, co-defendant Peter Pfabe, in exchange for alleged client and marketing services.
The defendants did not provide the promised services and instead withdrew money from the companies’ accounts to fund their horse farm Field Pointe Farm in Salt Point, New York, and to cover personal expenses, the indictment said.
This scheme allegedly ran from November 2002 to March 2008 and involved Pfabe’s companies Saint Andrews Marketing Inc. and Greenwich Marketing Associates Inc., the indictment said.
Walker oversaw client services at Deutsche Asset Management for all but two months of the May 2002 to January 2006 period and was head of global client service at AIG Global Investment Group from February 2006 to June 2008, the indictment said.
Pfabe was a director of global institutional marketing in an asset management unit of a large bank from April 1999 to April 2003, according to the indictment. He has worked as a director of global marketing at Citigroup Inc.’s institutional asset management unit, according to a May 2006 newsletter of the New England Dressage Association.
Walker and Pfabe were each charged with five counts of wire fraud, two counts of mail fraud and one count of conspiracy. Walker also faces two other wire fraud counts for allegedly causing AIG to pay $39,000 for clothing and other items, including for the farm, from a Greenwich, Connecticut merchant.
Deborah Colson, a lawyer for Walker, in an interview said her client will plead not guilty and intends to fight the case in court. She declined further comment.
It is unclear whether Pfabe has retained a lawyer for his defense. Efforts to reach Pfabe were unsuccessful. A call to Field Pointe Farm was not answered.
Deutsche Bank spokeswoman Mayura Hooper said the German bank is cooperating with the probe. Citigroup spokeswoman Danielle Romero-Apsilos declined to comment. AIG spokesman Mark Herr declined to comment.
The case is U.S. vs Walker et al, U.S. District Court, Southern District of New York, No. 10-cr-00977.
(Reporting by Maria Aspan, Ben Berkowitz and Jonathan Stempel in New York; editing by Andre Grenon)
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