“To advance his $95 million fraud scheme, Caspersen allegedly put on a shameful charade—creating fake email addresses, setting up misleading domain names, and inventing fictional financiers,” Bharara said in a statement. “When confronted by a suspicious client who had invested $25 million, Caspersen had no good answers.”

Caspersen is a private equity veteran who spent the first nine years of his career at Coller Capital, a global firm that specializes in secondaries (i.e., the buying and selling partnership interests in third-party funds). In 2013 he joined The Park Hill Group, a placement agent that was owned by The Blackstone Group (BX), as a managing principal focused on secondary advisory activity. Last fall, Park Hill was included in Blackstone’s spin-out of its M&A advisory business, which was renamed PJT Partners and led by former Morgan Stanley (MS) banker Paul Taubman.

News of Caspersen’s arrest have led PJT’s stock to dip more than 12%, but the origins of his alleged fraud actually began while Park Hill was still part of The Blackstone Group.

According to the complaints, Caspersen was a point person on Park Hill’s assignment for a private equity firm called Irving Place Capital Partners—formerly a private equity arm of Bear Stearns—that was seeking to restructure a $2.7 billion fund that it had raised in 2006. The plan (as reported at the time by Fortune and others) was to create what is known as a stapled secondary, in which investors essentially buy out the existing portfolio and commit new capital for additional investments. That deal closed last summer, led by Caspersen’s former colleagues at Coller Capital.

A few months later, PJT spun out of The Blackstone Group. And this is where Caspersen allegedly transitioned from intermediary to grifter.

According to the complaint, Caspersen in late October 2015 reached out to an individual who advises a charitable foundation, claiming to have an opportunity related to Irving Place’s stapled secondary. He allegedly claimed that Coller had been concerned that it couldn’t finance the entire deal on its own, and had set up an $80 million credit facility backed by the Irving Place portfolio assets—but only $30 million was spoken for. Moreover, Caspersen claimed that his own family office was among the investors.

The individual agreed to invest $25 million—$24.6 million on behalf of his charity and $400,000 from his own personal account.

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According to the complaint, however, Coller had never authorized Caspersen to set up such a vehicle. Nor had Irving Place, which sources say was unaware of the entire situation until this past weekend.

Just weeks later, Caspersen allegedly wired $17.61 million from the special purpose vehicle into his own brokerage account. He then wired another $8.1 million into a PJT-controlled bank account, “for the purpose of covering up an earlier unauthorized wire transfer of the same amount Caspersen had diverted for his own use.”

But Caspersen’s personal investments didn’t bear fruit, and earlier this month he began soliciting that same individual for another $20 million investment into the same deal. Caspersen claimed his family office was investing an additional $5 million. When the individual said that he wanted to speak directly to the special purpose vehicle’s signatory at Coller Capital, Caspersen allegedly created an email address that the individual quickly sniffed out as a fake. Moreover, the individual called Coller and was told that no one with the signatory’s name had ever worked at the firm.

As Caspersen’s alleged fraud was being uncovered, he apparently tried a last-ditch attempt to reimburse the foundation by raising $50 million for the same “deal” from another institution, but it never came to fruition. Instead, he was charged with securities and wire fraud.

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A few outstanding questions:

1. There is no explanation in either lawsuit as to why Caspersen needed so much money. He should have been making a heady salary at Park Hill, and comes from a wealthy family.

2. We do not know the name of the foundation that was allegedly defrauded, but it’s fairly unusual for there to be a charity that can simultaneously: (a) Be large enough to make a $25 million private equity investment, and (b) Be unsophisticated enough to not have an in-house alternative investment team.

3. We do not know the name of the individual who recommended the investment to the foundation, although the complaint says he works at a hedge fund. Clearly he may soon face his own lawsuit for breach of fiduciary duty. For example, he never checked to see if the signatory existed.

4. Caspersen has a family history of alleged fraud. His father, Finn Caspersen, committed suicide as federal authorities were building a case against him for tax evasion.

5. The complaints do not include more information about the $8.1 million that Caspersen allegedly stole from PJT, but clearly the disclosure raises control concerns for the firm.

PJT Partners this afternoon issued a lengthy statement which said, in part:

“We were stunned and outraged to learn of the fraudulent circumvention and violation of the Firm’s compliance policies and ethical standards by Andrew Caspersen, who was a member of the Secondaries Group at Park Hill since January 2013. Immediately upon learning of facts that suggested improper behavior, we commenced an internal investigation led by outside counsel, Paul, Weiss, Rifkind, Wharton & Garrison, and very quickly thereafter, brought the matter to the attention of the U.S. Attorney’s Office in Manhattan. Since that time we have cooperated fully with law enforcement, and we will continue to do so. We have terminated Mr. Caspersen for cause.

A Blackstone Group spokeswoman said: “We are appalled by the fraudulent actions of this former Park Hill employee. PJT and the authorities will have our full cooperation and assistance as they pursue this matter.”

Coller Capital issued the following statement: “At this stage, the firm has no reason to believe there was any wrongdoing by Mr Caspersen during his time of employment with Coller. No accusations have been made against Coller Capital or any current member of the firm’s staff. Indeed, Coller’s first knowledge of the matters under investigation by the US Attorney’s Office was in late March 2016.”

A spokesman for Irving Place declined comment.