Bernie Madoff, who was sentenced to 150 years in prison yesterday, may be the mastermind behind America's biggest Ponzi scheme, but he's certainly not the only person to run a scam for millions of dollars. Financial corruption has been around as long as people have been making money. And some of the corrupt have had some pretty quirky personalities.
Lord Conrad Moffat Black, Baron of Crossharbor
This flamboyant formerly-Canadian newspaper baron got his start by selling stolen exam papers at his upper-class private school. He eventually gained control of Hollinger International, a company that published London's Daily Telegraph, the Chicago Sun-Times, the Jerusalem Post, the National Post, and hundreds of community newspapers. At one point, he gave up his Canadian citizenship to become a British lord, and was known for excessive rants about how the rich were better and smarter than the poor. Richard Nixon is one of his lifelong heroes.
Black used Hollinger as his own personal bank account for extravagant purchases and travel--he owned houses and apartments in Palm Beach, Toronto, on Park Avenue in New York, and in Kensington in London. His company leased a corporate jet for $3 million a year, which he used for personal travel. His wife, Barbara Amiel, billed $2,463 in handbags and $2,785 in opera tickets to the company. Once investors and the SEC found out, they weren't very happy. After a press-heavy trial in 2007, he was found guilty of three counts of mail and wire fraud and one count of obstruction of justice.
Memorable Quote: "I have no doubt that mothers in America use my name to frighten their children into finishing their vegetables."
Where He Ended Up: Black was sentenced to 78 months in jail and is currently incarcerated at the Coleman Federal Correctional Complex in Florida. He's since appealed to the Supreme Court, but a decision isn't expected until 2010.
Rene Rivkin
An Australian businessman and stockbroker who was obsessed with the market, he got into the industry when he was 14 and was accidentally allocated shares in the float of a broadcasting company. Rivkin became famous for the Rivkin Report, a publication that would advise what stocks to buy and sell. At his height, he bragged that all of his employees were jealous of one another -- because they were all in love with him.
In April 2003, he was found guilty of insider trading after buying 50,000 shares in the airline Qantas after finding out about an impeding merger between Qantas and Impulse Airlines. During his time in jail, a fellow detainee was paid by The Sun-Herald to smuggle in a cellphone camera and take photos of Rivkin while he was sick. After his sentence, he was banned from stockbroking for life.
Memorable Quote: On getting a tumor: "It's not that I thought I was immortal but that I could never imagine the world without me."
Where he ended up: The stockbroking ban took a heavy toll on Rivkin, and he committed suicide at his mother's home in May of 2005.
Horatio Bottomley
This British financier founded the Financial Times and eventually became a member of parliament -- but he scammed with the best of them. In the mid-1800s, he made a name for himself by promoting Australian gold mining projects, some of which didn't actually have any gold. He later invested in the stock market, and founded FT in 1888. He was elected to parliament in 1906, but was thrown out in 1912 after being charged of conspiracy to defraud, leading to his bankruptcy.
From there, he founded a patriotic, anti-German, journal called the John Bull. He used it to create the John Bull Victory Bond Club, which was supposed to be a way for small savers to lend money to the government, getting prizes instead of interest. He made about 900,000 British Pounds (about 160 million Pounds today), and spent that on expensive living, horse racing, and women. But when the scam went bust after World War I ended and all of his bondholders wanted their loans back. Bottomley was sentenced to seven years in prison in 1921. After getting out, he tried to start a new newspaper, but it went bust -- and he went bankrupt again. He spent the early 1930s travelling the UK as a one man show, where he rambled about how great the old days were. It flopped, and he went bankrupt a third time.
Memorable Quote: "Gentlemen: I have not had your advantages. What poor education I have received has been gained in the University of Life."
Where he ended up: After his last bankruptcy, a destitute Bottomley turned to charity to survive. He died in 1933
categories: Fun With Economics
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