The securities fraud trial for the former business partner of former North Salem Supervisor Paul Greenwood was scheduled to start June 12 but has been postponed. Stephen Walsh, Greenwood’s former partner in WG Trading and related companies, is appealing a denial of the use of the proceeds from the sale of his house to pay for his defense.
The next conference before U.S. District Judge Miriam Cedarbaum, who is handling the criminal side of the securities fraud case, is scheduled for Sept. 14.
Greenwood pleaded guilty to six counts of securities fraud, wire fraud and related charges in July 2010 and agreed to cooperate with the U.S. Attorney’s Office. His sentencing has been postponed until after the trial. He admitted to taking tens of millions in investor funds for his personal use, hiding losses and lying to investors about their returns. He faces up to 85 years in prison and agreed to forfeit $300 million. A receiver has been collecting assets as part of civil cases against Walsh and Greenwood and distributing money to the investors, mainly pension funds and other institutional investors.
Greenwood resigned as supervisor shortly after being arrested in February 2009 and has since moved to North Carolina.