*** If you're going to steal, do it big time! Also make sure that you steal from sick kids and the church...***
JUNE 23, 05:55 EDT
Financier, Clients' $3B Vanish
By DENISE LAVOIE
Associated Press Writer
GREENWICH, Conn. (AP) — Neighbors who lived on a cul-de-sac near Martin Frankel had complained for years about the numerous cars going in and out of his driveway. They said he seemed to be operating a business out of his house.
But it wasn't until an automatic alarm called firefighters to Frankel's $3 million mansion on May 5 that it became clear what kind of business he was running.
Investigators found a to-do list, handwritten by Frankel. Item No. 1: ''Launder Money,'' according to a May 25 FBI affidavit filed in federal court in Bridgeport.
They also found astrological charts looking for answers to Frankel's concerns, including: ''Will I go to prison?''
Frankel, a 44-year-old money manager, has not been seen since the day of the fire, and up to $3 billion is now missing from insurance companies and a charitable organization.
Last month, insurance company regulators said Frankel's unlicensed brokerage — apparently run out of his mansion in this New York City suburb — had siphoned off money from a dozen small insurance companies in five states.
The companies, based in Mississippi, Oklahoma, Tennessee, Missouri and Arkansas, were placed in receivership when they could not account for assets invested with Frankel's Liberty National Securities Inc.
Regulators said the insurers are missing at least $218 million, but a lawsuit filed by some of the companies put the loss at $915 million.
Also missing is as much as $1.98 billion from the St. Francis of Assisi Foundation, which was established by Frankel in the British Virgin Islands last August. It was supposedly a charity to help sick kids, but investigators suspect it was only a front for fraud.
A federal grand jury in Bridgeport has been investigating Frankel since mid-May, the Greenwich Time reported last month. A sealed warrant has been issued for his arrest, the New York Daily News reported Tuesday, citing unidentified law enforcement sources.
No attorney has identified himself as representing Frankel, and family members in Ohio, including Frankel's mother, told The Blade of Toledo that they had not heard from him in several weeks. He apparently was not married.
Law enforcement officials said Frankel used several aliases, including the name of his bodyguard, after being barred from trading by the Securities and Exchange Commission in 1992.
All of the insurance companies are owned by Thunor Trust, which lists Tennessee-based businessman John Hackney as trustee. Hackney did not return a call Tuesday.
In the months before the fire, Frankel spent more than $1 million on shopping sprees at Baccarat, Tiffany and Gianni Versace and on trips to Rome, Geneva and London, according to financial records obtained by the Time.
Frankel's stone mansion is in Greenwich's ''backcountry,'' a secluded area of multimillion-dollar estates, woods and horse trails. Since the fire, the long, hilly driveway that leads to his home and several other houses has been guarded by police.
Frankel, a native of Toledo, Ohio, had converted his home into a maze of offices with more than 80 computers and wide-screen televisions tuned to financial news channels. When firefighters arrived last month, they found a blazing file cabinet and two fireplaces stuffed with burning documents.
Phil Russell, a Greenwich lawyer who represents three of Frankel's neighbors, said Frankel increased security at his mansion a few months ago, building a guardhouse and a six-foot fence around the property, and adding flood lights. He also stationed an armed guard outside.
KJC |
