Can there be a funnier scene? The 2005 remake of the 1977 classic Fun with Dick and Jane finds Jim Carrey as the hapless spokesman for Globodyne, a Tyco-sized conglomerate that at once does everything and nothing. Invited onto a CNBC-style financial show (with a cameo by Ralph Nader), patsy Carrey is grilled about company corruption as its stock price nosedives with his every word.
If only life were as funny. This week Jeff Skilling, the former Enron chief executive convicted of fraud at the world’s largest energy trader, announced he is seeking a new trial. On the heels of the announcement, we take a look back at the rogues gallery of financial miscreants and ask, “Where are they now?”
1). John Gutfreund—Michael Lewis does our homework for us, with his excellent essay in now defunct Portfolio Magazine.Lewis recounts how he came upon the idea for Liar's Poker, his classic tale of Reagan-era Wall Street greed that now seems quaint. In September 2008, Lewis had lunch with John Gutfreund, the former Salomon Brothers chief who arguably started “it” all by taking the firm public in the late 1980s, the first on Wall Street to do so. From there it was no longer about responsibility to clients, but responsibility to shareholders. The outrage caused by revelations of excess contained in Lewis’ book had a big hand in ending Gutfreund’s career, and he has since fallen on hard times.
“Your…f—ing…book,” Gutfreund told Lewis at their lunch meeting. “Your f—ing book destroyed my career, and it made yours.”
2). Nick Leeson—One of our favorites for how well it all worked out—for Leeson. In a classic example of crime pays, he received two book deals, a movie deal (starring Ewan McGregor as Leeson) and in 2005 was named general manager of Galway United Football Club. What did Leeson do to receive such a windfall?
He caused the collapse of Barings Bank in 1995, whose depositors included the Queen of England. He was sentence to 6 ½ years for his fraudulent trading activities (of which he served four), and his wife divorced him after revelations of infidelity with Geisha girls in Singapore, where the couple were posted by the bank. Today, you can hire him for “why I did what I did” soul-searching speaking engagements for a price, or even as a consultant to your business. We say good luck.
3). Ivan Boesky—The disgraced Wall Street trader is thought to be the inspiration for Gordon Gekko (though with hang-dog looks, he’s no Michael Douglas). In 1986, before his insider trading transgressions were revealed, he gave a speech at the University of California, Berkeley, where he said “Greed is all right, by the way. I think greed is healthy. You can be greedy and still feel good about yourself." Sound familiar?
After serving jail time and being fined $100 million, Boesky was barred from the securities business for life. His $200 million scam led to the demise of Wall Street firm Drexel Burnham. Rarely heard from today, the 72-year-old Boesky lives a quiet retirement.
4). Christopher Rocancourt—Calling himself a member of American aristocracy, this “French Rockefeller” scammed the rich and famous by posing as a financial advisor to the stars. In an example of “other teams can't stop staring at those pinstripes” from Catch Me if You Can, Rocancourt always squired beautiful women, including supermodel Naomi Campbell, and flashed a wad of cash, never letting his marks pay for a dinner tab.
It worked. He lived for a time with Mickey Rourke and convinced actor Jean-Claude Van Damme to produce his next movie. He eventually married Playboy model Pia Reyes. His theft of investors eventually caught up with him, and in March 2002 he was extradited to New York and pleaded guilty to charges of theft and grand larceny, among others, against 19 victims. He was fined $9 million and ordered to pay $1.2 million in restitution. In 2004 he was then sentenced to five years in prison.
5). Madoff Mini-Me—The legacy of Bernie Madoff (besides shame, disgrace, lost fortunes, destroyed lives, family angst, no retirement, lost houses, unpaid medical bills etc., etc., etc.) will be that every Ponzi scheme, no matter its size, will now be made a comparison.
The latest example? “The Bernie Madoff of Bay County gets 12 years.” The Northwest Florida Daily News reports on the sentencing of con man Harrison Jones. Never mind that he stole $6 million instead of $60 billion, the moniker will become cliché, as it has with the word Ponzi itself.
6). Charles Ponzi—And speaking of the man; while it might seem he simply had an unfortunate name, like Frank Mussolini or Billy Bin Laden, the Boston-based swindler did in fact give rise to the scheme. His postal reply arbitrage con claimed to double an investment within 90 days, and by 1920 he had amassed millions. Of course, it then crashed. He spent a total of 10 years in prison, started a number of other schemes and eventually died penniless in Rio de Janeiro.
In one of his last interviews, he showed little remorse, telling a reporter, "Even if they never got anything for it, it was cheap at that price. Without malice aforethought I had given them the best show that was ever staged in their territory since the landing of the Pilgrims! It was easily worth fifteen million bucks to watch me put the thing over.”
Today, we hear that he complains of hot temperatures and back-breaking work along the river Styx.