Petters admits close relationship to top associates, but says they still hid fraud from him

Petters, on trial, insists associates hid fraud

ST. PAUL, Minn. — Prosecutors are attacking Minnesota businessman Tom Petters’ claim that his trusted associates carried out a multi-billion-dollar fraud behind his back.

Petters has blamed two top officers at Petters Co. Inc. — Deanna Coleman and Bob White — for a Ponzi scheme the government says cost investors $3.65 billion.

But Petters reluctantly agreed with prosecutor Joe Dixon on Thursday that he had a close relationship with Coleman. He even admitted the relationship became sexual for a time around 2005.

Yet Petters testified that Coleman was able to hide the fraud from him.

Petters has pleaded not guilty. Both Coleman and White have pleaded guilty and agreed to cooperate with authorities in hopes of getting lighter sentences.