Judge orders financial adviser to the stars held without bail for trial

Thursday, April 13, 2000 | 10:41 a.m.

Assistant U.S. Attorney David Lewis called 37-year-old Dana Giacchetto's behavior "absolutely extraordinary."

Giacchetto, 37, was arrested shortly before 2 a.m. Wednesday at Newark International Airport in New Jersey, as he returned from Las Vegas with federal agents closing in on him.

Lewis said the government had alerted the FBI in Honolulu, Las Vegas and Los Angeles to track Giacchetto down after learning he had purchased more than $16,000 in plane tickets Sunday to various worldwide destinations.

Giacchetto was tapping funds ordered frozen by a federal judge after he was charged with swindling his clients out of millions of dollars while managing their money and attending their swanky parties, Lewis said.

U.S. Magistrate Judge James C. Francis said Giacchetto was a "substantial risk of flight" and revoked his $1 million bail, ordering him held in prison until trial.

Lewis said Giacchetto, whose clients included Leonardo DiCaprio, Ben Stiller and Courtney Cox Arquette, was arrested because he violated bail conditions, failing to get approval to fly to Las Vegas on Sunday.

The prosecutor said what federal investigators found on Giacchetto was "quite extraordinary."

The defendant was carrying more than $4,000 in cash in small bills, largely $5 and $10 bills, along with $44,000 in unused plane tickets, most of them first class, to destinations around the world, he said.

Giacchetto also carried a seven-coupon plane ticket he had purchased Sunday to Denver, Las Vegas, Los Angeles, Honolulu, Tokyo, Singapore and Frankfurt, he said.

He also had two tickets to Rome in his own and his girlfriend's names, Lewis added.

Investigators also found a mutilated 1986 passport missing a page, which would have shown it had expired, and with a bogus expiration date added on another page, he said.

As another argument for revoking bail, Lewis said the criminal case "is extremely strong that Mr. Giacchetto was engaged in a wholesale looting of clients' accounts."

Andrew Levander, Giacchetto's lawyer, said his client was not trying to flee the country and was merely using the expired passport as identification because he needed a picture identification card to travel on a plane.

He said the tickets to Rome had been bought so he could propose to his girlfriend in a romantic setting.

The lawyer, accusing prosecutors of overreacting, said his client earlier this week "was shocked to find out he was wanted and immediately came back."

The government alleges Giacchetto stole as much as $5 million from the band Phish and its members and a million dollars more from others while misappropriating as much as $20 million entrusted to him.

He also was accused of issuing fake portfolio statements and other false documents to clients who wanted proof of their purchases.

Giacchetto is charged with securities fraud and with making false statements to the Securities and Exchange Commission. If convicted, he could face a decade in prison and $12 million in fines.

He allegedly committed the crimes while serving celebrities including Matt Damon, Cameron Diaz and singer Alanis Morrisette through an investment business, The Cassandra Group, run from a SoHo loft.