Accused scammer won't give up Faberge eggs or submarine — and lands in jail

A federal judge in Minnesota today ordered Trevor G. Cook jailed for failing to surrender more than $35 million in assets. Specifically, the judge in the case wants Mr. Cook, a self-styled money manager charged in an alleged $190 million foreign currency trading scheme, to surrender $27 million located in offshore accounts, a BMW and two Lexus automobiles, a submarine — yes, a submarine — a houseboat, a collection of expensive watches, a collection of Fabergé eggs, Bon Jovi concert tickets and $670,000 in cash. The Securities and Exchange Commission obtained an order for Mr. Cook to surrender his assets in November when it charged him, along with nationally syndicated radio host Patrick J. Kiley, in the alleged fraud. But the SEC filed a motion last month in U.S. District Court for the District of Minnesota alleging that Mr. Cook had violated that court order. In court today, chief judge Michael J. Davis found Mr. Cook in civil contempt and ordered him jailed until he complies with the court's orders. “Mr. Cook has elected to disregard the court's orders and will now be a guest of the federal correctional system until he mends his ways,” said Merri Jo Gillette, director of the SEC's Chicago Regional Office. Mr. Kiley pitched the unregistered investments on “Follow the Money,” a show that he hosted on radio stations nationwide. The SEC says that Mr. Cook and Mr. Kiley sold the unregistered investments through shell companies by misrepresenting that they would deposit the funds in foreign-currency accounts. The regulator said the duo claimed that the currency accounts would generate annual returns of 10% to 12%. Instead, their foreign-currency trading resulted in millions of dollars of losses, according to the SEC. The pair allegedly misused about half of the investor funds to make Ponzi-like payments to investors and pay for Mr. Cook's gambling losses and other purchases.