Trial Begins for Alleged $3.7B Minnesota-Based Ponzi Scheme

MINNEAPOLIS – A Minnesota businessman accused of running a Ponzi scheme that authorities say was overtaken at the time only by Bernard Madoff's is going on trial this week.

Tom Petters built a small merchandise liquidation company into a diversified empire that owned well-known businesses such as Polaroid. But prosecutors allege the core of his business was a $3.65 billion fraud.

Petters is charged with 20 counts, including wire fraud, mail fraud, money laundering and conspiracy, that could imprison him for life.

He pleaded not guilty Dec. 2, just a week before Madoff began confessing to a scheme authorities say cost investors at least $13 billion.

Petters' trial is expected to take about six weeks, with jury selection starting Wednesday in federal court in St. Paul.