He was paid $200,000 his first year at Bear Stearns, but in order to earn more, he began siphoning commissions from a joint account he shared with his boss, his senior partner, into his personal account.
Paperny escaped Bear Stearns before he got caught, when another Wall Street investment bank hired him for an even better job.
UBS Financial Services offered to pay him more, too: A $1 million signing bonus, plus a salary and bonus.
Paperny jumped at the offer and quickly lined up a big client so that he could make even more money off of fees and commissions: GLT Venture Fund, a $600 million hedge fund.
But there was a catch: many people suspected that GLT was a ponzi scheme, and Paperny, as well as many other people, including his co-workers, started to find mounting evidence in support of their suspicions.
"I knew that I was making a deal with a devil," says Paperny.
The hedge fund manager who ran GLT was "perhaps the worst stock picker in the history of money management," Paperny told Cincinnati.com. He generated returns like Bernie Madoff, through his "loose code of ethics."
Paperny continued to encourage investors to invest their savings with GLT anyway. Like a 90-year-old rabbi, who he convinced to invest $3 million by assuring him, this is a sound investment.
Of course, he eventually got caught, and UBS fired him. But he only went to jail for a year. Now he works giving lectures about his experience.
This story originally appeared on Business Insider
Read more from Business Insider:
»REVEALED: Deutsche Bank's Incredible $2 Million Party At A Golf Hotel With Janet » Jackson
» Former Goldman Trader: There's Huge Unforeseen Demand Coming In The Physical Gold And Silver Markets
» 9 Wall Streeters Whose Bonuses Got The Dreaded "Clawback"
» The Truth About Who's Responsible For Our Massive Budget Deficit __________________________________________
Questions? Comments? Email us atNetNet@cnbc.com
Follow NetNet on Twitter @ twitter.com/CNBCnetnet
Facebook us @ www.facebook.com/NetNetCNBC