Meet Marc Dreier’s (Alleged!) Partner in Crime

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A guy like this would never say anything bad about a Kennedy.
Photo: Patrick McMullan

Last night, police arrested a 57-year-old named Kosta S. Kovachev on charges of conspiring with lawyer Marc Dreier to commit wire fraud, i.e., helping him sell utterly fake promissory notes to hedge funds, ultimately taking them for $380 million. (That's a lot of Les Pauls, which Kovachev seems to collect.) Like Dreier, who seems like a genuine sociopath, Kovachev is a real piece of work — not only does he have the name of a villain from one of the Die Hard movies, he has the past of one, too: Five years ago when he was living in Florida, he was charged by the Securities and Exchange Commission for helping run a $28 million Ponzi scheme with time-share units. He defrauded at least 600 investors in 30 states, the SEC said, charges that Kovachev neither confirmed nor denied — he just handed the SEC $358,148 in penalties and interest, and went on his way. Apparently, you can do that!

After that, it was on to bigger and better things.

Back in September, when one of Dreier's hedge-fund clients complained that his notes weren't being repaid on time and asked to meet with the developer's office, Dreier had Kovachev pose as the development company's controller and answer questions about the company’s finances. (Was he wearing a prosthetic nose? We can only hope.) What we do know is this: That the fake notes were attributed to notorious developer Sheldon Solow, a longtime Dreier client, means we may soon get to coin this trio the 'Axis of Assholes.'

Associate of Dreier Charged With Conspiracy [City Room/NYT]