Newspaper clippings, court rulings and other public documents leave little doubt that the co-defendant known as Larry Reynolds is actually Larry Reservitz, a swindler and drug trafficker who had associations with the New England mob in the 1980s and eventually was placed in the government's witness protection program.
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Reynolds said he got about $6 million in fees from Petters for laundering $12 billion in funds between 2002 and 2008. He pleaded guilty in St. Paul to conspiracy to commit money laundering and faces up to 20 years in prison.
Petters' trial on mail and wire fraud and money laundering is scheduled to begin in late October. But his attorneys now want the case against him dropped, suggesting that Petters himself might have been duped by Reynolds in an elaborate con that unfolded under the government's nose.
