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Indian businessman crash, pilot fake death, Marcus Schrenker
Jay Reeves/AP
A motel registration form filled out by a man believed by police to be Marcus Schrenker.

Man Who Faked His Death Ordered to Pay Millions in Fraud Suit

February 06, 2009 05:35 PM
by Josh Katz
Marcus Schrenker, who was arrested in January for allegedly faking his death, was just ordered to pay $12 million for not reporting the damages to a plane he sold.

Judge Orders Schrenker to Pay $12 Million for Fraud

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Alabama Circuit Judge Lawson Little ruled on Thursday that Marcus Schrenker, the pilot accused of faking his death, must pay $12 million in a lawsuit. Barnett Hudson argued that Schrenker sold him the airplane in 2002 saying it had never been damaged, but Hudson found out that the plane had incurred a great deal of damage from a “hard landing in 2001,” the Associated Press reports.

Schrenker had told Hudson’s attorney in December 2008 that “he was broke and wouldn't defend himself,” according to AP. When Schrenker allegedly faked his death in January, he “was facing more than $9 million in court judgments and potential penalties.”

Hudson also stated that Schrenker made minimal repairs to the plane even though he collected about $100,000 in insurance due to the crash.

Judge Little wrote: "The court takes judicial notice of the fact that Mr. Schrenker recently attempted to fake his own death and deliberately crashed his airplane in the panhandle of Florida; again, putting at risk innocent persons and businesses on the ground.”

Authorities arrested Schrenker at about 10 p.m. EST on Jan. 13 at a North Florida campground, according to the Associated Press. “He had cut one of his wrists, but he is still alive,” Alabama-based U.S. Marshals spokesman Michael Richards said.

Schrenker is accused of defrauding some of his clients out of hundreds of thousands of dollars. He is charged with two felony counts alleging he worked as an investment adviser without being registered,” according to the Indianapolis Star. “His registration was terminated Dec. 31, but he continued dealing with clients after that, the Indiana secretary of state’s office said.”

His wife, who has accused him of cheating, also recently filed for divorce on Dec. 30.

On Jan. 11, Schrenker, 38, allegedly tried to run from his problems, leaving Indiana in his private plane, a Piper PA-46. On his way to Destin, Fla., he allegedly faked a distress call to air traffic controllers saying that his windshield imploded and he was bleeding heavily. His crashed plane was later found in a Florida swamp with the door open and no pilot to be found, according to The Guardian.

Authorities surmised that Schrenker had put the plane on autopilot at about 2,000 feet and parachuted to safety, CNN reported.

The next day, in Childersburg, Ala.—more than 200 miles from where the plane crashed—a man with Schrenker’s driver’s license told police that he had been in a canoe accident. According to The Guardian, “he was wet only from the knees down and had what appeared to be goggles made for flying.” The police led him to a hotel, and he was seen entering a wooded area near the hotel. Investigations soon learned of his location in northern Florida.

Schrenker also headed his own aircraft aerobatics team. He displayed his flying abilities in a YouTube clip in which he describes the tricks his team can perform: “You name it, we do it.”

Since authorities arrested him in Florida on Jan. 13, Schrenker has been in jail. According to AP, he “pleaded not guilty to charges of deliberately crashing the aircraft and making a false distress call.”

Related Topic: Other fake deaths

Although Schrenker’s tactic for avoiding financial fraud is unorthodox, other people have tried the same thing.

Samuel Israel, the cofounder of the Stamford, Conn. hedge fund Bayou Group LLC, was about to serve 20 years in prison for robbing his investors of more than $400 million. But in June 2008, he tried to avoid prison by faking his suicide. He abandoned his car near the Bear Mountain Bridge in New York with the message “Suicide is Painless” written on the windshield.

Following Israel’s mysterious disappearance, police aircraft and boats began searching the river for his body. When they could not find his body or any witnesses who saw a man jump, they determined that the suicide was a hoax. Israel would turn himself into police just over a week later.

Also in June 2008, a man on the other side of the globe was arrested for faking his death years earlier. After the failure of his car rental business left him saddled with debt, Gandaruban Subramaniam of Singapore, “faked his own death in a civil war shoot-out in Sri Lanka in 1987 to escape his creditors and claim S$331,341 ($243,600) in insurance money,” Reuters reported. Subramaniam was imprisoned for three years for the ploy.

Following a spearfishing outing in September 2008, John Sung Park, 29, went missing in Laguna Beach, Calif. A day-long search effort that cost an estimated $50,000 failed to find the man. According to the Los Angeles Times, authorities believe that Park, who has not been found, faked his own death, as he “was scheduled to appear at a sentencing hearing on felony charges brought by La Palma police for drug possession, forgery, burglary and receiving stolen property.”

In 1974, British MP and former Labour Minister John Stonehouse went missing in Miami, Fla.; his clothes were discovered on the beach and he was believed to have drowned. On Christmas Eve 1974, authorities discovered him living under a different name in Australia.

Stonehouse had been involved in a number of fraudulent businesses and decided to flee from the potential criminal charges he would face. While happy to learn her husband was alive in Australia, Stonehouse’s wife was shocked to find that her husband was living with his 28-year-old secretary Sheila Buckley. Stonehouse was brought back to England, where he was sentenced to seven years in prison on charges theft, fraud and deception.

Related Topic: Fake abductions

Jennifer Wilbanks, the infamous “runaway bride,” disappeared four days before her Georgia wedding in April 2005. A few days later, she called her fiancé from Albuquerque and said she had been abducted and sexually abused. She would later admit that she had fabricated the whole thing, “because she feared she could not be the perfect wife,” USA Today reported. The wedding was eventually called off, but Wilbanks popped back into the headlines in October 2006 by suing the fiancé, John Mason, for $500,000 by selling the story of their episode and not sharing the money with her.

Former University of Wisconsin–Madison student Audrey Seiler, 20, vanished for four days in March 2004 and told police that she had been kidnapped. But, according to The Associated Press, “police concluded Seiler made up the story after obtaining a store videotape that showed her buying the knife, duct tape, rope and cold medicine she claimed her abductor used to restrain her.” Police suggested that it was “a desperate attempt to get her boyfriend’s attention.” A month later Seiler was sentenced to up to nine months in jail and fined $10,000 for her lies.
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