Head of prominent NYC law firm accused of fraud

The head of a prominent law firm was charged in a "stunning, brazen fraud" that reaped at least $113 million in profit by tricking hedge funds into making bogus investments, prosecutors said.

Marc Dreier, 58, was charged in a criminal complaint and by the Securities and Exchange Commission in the alleged sale of fraudulent promissory notes.

"Our complaint alleges a stunning, brazen fraud that targeted some very sophisticated institutional investors," said Linda Chatman Thomsen, director of the SEC's Division of Enforcement.

"Investors big and small should take heed, especially in these difficult economic times, that con artists are out there and may go to elaborate lengths to commit fraud," she said.

Assistant U.S. Attorney Jonathan R. Streeter said the government wants Dreier held without bail. During a brief court appearance, the Manhattan resident's bail hearing was set for Thursday.

"This is a very complicated matter and the facts are beyond reach ... of a sound bite," said defense lawyer Gerald Shargel.

In a related case, Dreier was charged last week in Toronto with impersonation in connection with the attempted sale of $45 million worth of notes to a hedge fund.

The scandal has stunned Dreier LLP, a mid-size law firm that has represented celebrities including retired football star Michael Strahan and former News Corp. publishing executive Judith Regan.

Attorney General nominee to earn $4.6 million

Attorney General-designate Eric Holder will earn $4.6 million from his law firm this year and next, according to financial records he provided to the Senate Judiciary Committee.

The committee, which is preparing for Holder's confirmation hearing on Jan. 15, released the records Wednesday.

Holder will earn $2.1 million this year and $2.5 million next year from the law firm of Covington & Burling, including deferred payments. He listed his total assets at $5.7 million, with no liabilities.