Authors: Greg B. Smith
Nothing But Money (13 page)
Cary and Andrea were well aware that their bedridden mother had been trying to raise Erin all by herself down in Florida. It wasn’t working out. The teenager had become a wild child whom Cary and Andrea hardly knew. Now she was about to enter their lives in a big way. They were responsible for her, by law and by agreement. Cary and Andrea were about to become parents.
Life for the devoted bachelor and his party girl sister was over. Cary had not seen this one coming.
The day Cary and Andrea became parents by default, Erin was a teenager who did what she wanted and listened to no one. Her father had long ago disappeared, and Cary’s mother had been bedridden. Cary remembered, “My mother at the time was living in Florida. I was living, obviously, in New York, and Erin had absolutely no supervision. My mother, the last year of her life, was bedridden and lived on morphine. Erin was out of control. There was no, God forgive me for describing my little sister that way, but there was no supervision at all. My mother was incapable of even getting out of bed.”
This was not going to be easy.
As Cary and Andrea flew down to Florida for the funeral, Cary admitted he didn’t really know Erin at all. When she was two, he’d headed off to college and hadn’t come back. A simple way to put it was this: “I was thirty-one. Erin was thirteen years old.”
How would Cary fit that into his Wall Street cowboy lifestyle? It didn’t seem possible. Were his trips to Aspen over? Was that it for the barhopping and the model hunting? Would the hours spent in the tanning booth now have to be spent going over high school geometry homework? He couldn’t even remember half of that nonsense. Cary Cimino—Dad. It just didn’t ring true.
1994
When friends asked Cary what he thought about Wall Street, he always answered in plain English: “You didn’t go to Wall Street to become a rabbi or a priest, all right? You went to Wall Street to make money.” When he was ultimately asked why he started taking under-the-table commissions in cash, he relied on the argle-bargle he’d picked up hanging around with psychiatrists:
“I subverted a methodology.”
In the three years since his mother’s death, Cary had decided that “subverting a methodology” was the only way to keep ahead of the wolf pack. The strains were enormous. Cary was paying for everything and everyone. He supported both his sisters, and he was back in a top-of-the-line apartment on the Upper East Side. The Aspen vacations, the Hamptons rental, the Mercedes, even the tanning salon visits cut into the net in a big way. There was tremendous pressure all the time, and to make that work, each day Cary looked for more money than he had earned the day before.
“I’m spending huge sums of money at this point. It’s a lifestyle, a sybaritic lifestyle. Trips to Aspen two, three weeks at a time, trips to St. Bart’s, trips to St. Tropez, trips to Paris, rental houses in the Hamptons, $10,000 a month for a year. Plus putting my sister Erin through high school and college. Buying my sisters automobiles. Every need that my sisters had—from medical to clothing to housing to education to vacations—I provided. My sister and I, to remind you, were bringing up a child. Erin was thirteen to twenty-one during this time, and I took the financial responsibility.”
He called himself a financial adviser now. Stock promoter just didn’t sound prestigious enough. It was too P.T. Barnum. Financial adviser had a ring of old money to it. And he’d achieved a kind of balance between his personal and business lives. It hadn’t been easy.
First he’d first had to resolve problems that surfaced with Andrea. She’d had some addiction issues and than become involved with a guy who was involved in dealing narcotics. This had created a certain amount of intra-sibling friction, to say the least. She was now telling him she’d gone straight, but she still was unable to hold a real job for more than a few weeks. She would call him at least once a day, usually more. They had always had a strange relationship, since the time when he was ten and she was eight and he was helping her get off to school each morning in that big old empty Oyster Bay house. Now their relationship was even stranger. They were supposed be both brother and sister and also mother and father. They had shipped Erin up to New York and put her in a boarding school in a rural county as far away from the city as Cary could manage. It was a lot of work, this parenting business.
There were rewards. When Erin first arrived, she was not used to being told what to do. She got used to it, and once she had settled into school in Orange County, New York, and was learning to grow up a little bit, she made it clear that Cary was a kind of savior. They overcame age differences. He made sure she went to school and took care of herself. In one letter in which she refers to herself in the third person, she wrote, “Well aside from God, I do believe she wouldn’t have turned around so glorious if it hadn’t been for the care and concern of her older brother, Cary Cimino. She can thank him every day for the dedication he put towards her in having a better life and there will never be enough gratitude she can show to him. However sad this may seem, it is 100% true—he has given me more than our own mother has.”
Sometimes Andrea was able to help out as well, in other ways. In the spring of 1994, Andrea took up with a new guy, an older silver-haired married guy from Brooklyn named Sal Piazza. Andrea was thirty-two; Sal was in his mid-fifties. He called himself a businessman, an owner of Document Management Network, a fax company he owned with another guy. Piazza had seen that Wall Street was beginning to rebound and he wanted to get in on that. He proposed turning Document Management Network into DMN Capital. He put it in his wife’s name. He was actually quite soft-spoken and pretty savvy about business, and he and Cary got along quite well. One evening when the three were socializing, Sal mentioned a guy he knew, his new business partner, who might be interested in talking with Cary about a deal he was working up. Sal had mentioned to this guy that Cary was a registered stockbroker with plenty of connections to heavyweight investors and other stockbrokers. The guy was less interested in the investors and more interested in the stockbrokers. The guy’s name was Jeffrey Pokross.
Cary couldn’t believe what a small world it was indeed.
They met at the offices of DMN, in an office tower on Liberty Street in Lower Manhattan, a block or two from Wall Street. Cary was less than impressed. DMN was just unfinished office space with a couple of desks, some phones and computer monitors, and empty coffee cups strewn about the badly carpeted floor. It was, Jeffrey made clear when he greeted Cary at the door, just a start-up.
Cary hadn’t seen Jeffrey in years, but he looked exactly the same. His hair was thinner and he was a little thicker at the middle, but he still had those hungry little eyes and the rodentlike mustache.
“We’re going to be rich,” Jeffrey said. “Let me tell you about Spaceplex.”
When Cary Cimino got involved in a business deal, he liked to know all the details. When Cary Cimino walked into DMN Capital in late 1994, he definitely did not know all of the details.
He did know some. The partners included Sal Piazza, the guy who was dating his sister. Sal he knew. Jeffrey Pokross he also knew. Cary was vaguely aware that there were issues with Jeffrey, but he could live with that. He did not see Jeffrey Pokross as a man with a problematic history who could drag him into the tar pit of criminal conspiracy. He looked at Jeffrey Pokross as a solution to his many personal problems.
“Jeffrey was a bombastic, caustic, arrogant man who bullied people, who literally threatened people, bullied people and asserted himself in a methodology I didn’t appreciate. But I was being substantially rewarded for bad behavior. The term is ‘easy money,’ and Jeffrey provided product, had contacts, and I had substantial distribution. It was, again, a meeting of the minds.”
Then there was this other guy, Jimmy Labate. There was no way this guy went to the Wharton School. Jimmy was probably six feet, two fifty, a young hotheaded guy with thinning reddish hair who was built like a refrigerator with a head. He wore knee-length leather jackets. He carried rolls of bills, drove a Lincoln and was able to craft unique combinations of epithets without even trying. He would say, “Fuck you, you fucking fuck,” and not even appreciate the alliteration. He was a partner in DMN.
Cary stayed away from Jimmy.
Instead, he listened to Jeffrey. Jeffrey had a plan. The company was called Spaceplex. They were going to take it public. The company’s formal name was Spaceplex Amusement Centers International Ltd., and although it was certainly not international, it was fair to call it limited. Spaceplex was actually a small company in Las Vegas that owned absolutely nothing, but had obtained a contract to buy a small family amusement park on Long Island. Pokross had found Spaceplex after getting a call from an old client, a German guy named Goebel who ran the U.S. securities division for one of the biggest German banks in existence. Pokross claimed this German called him to say he had a childhood friend named Ulrich who had control of a bunch of German boiler rooms.
As Pokross remembered it, “Mr. Goebel wanted to know if I could come up with a stock in the U.S. that I can identify and handle the trading of that security and he would pump it out with his friend Ulrich at these various German boiler rooms where they were going to be paying cash bribes to the owners . . . and the stockbrokers. I started looking right away.”
After a number of calls to various corrupt brokers looking for a patsy company, Pokross came up with Spaceplex. The president of the company was a guy named Manas, whom everybody called “Mr. Fingers.” Jeffrey didn’t bother to explain how Manas had earned such a nickname, but Cary wasn’t that interested anyway. Pokross said the owner “was looking for stock promotion and to get some money in the company. He was looking for somebody to drive the price of his stock up because he was a big shareholder and he wanted to raise some additional money.” If Mr. Fingers was interested in actually running an amusement park, Pokross didn’t say.
Working with a corrupt broker named Andy Mann, Pokross said the scheme was to pay off other corrupt brokers and stock promoters like himself with cash and free stock from other companies Mann held in his offshore brokerage firms. He already had the boiler rooms in Germany waiting to begin pumping up Spaceplex stock. All they needed now was to go out and recruit brokers for the U.S. sales pitch. Once they got the stock where they wanted it, all the insiders would dump en masse and they’d all be rich. Pump and dump. Pokross would be paying Cary an off-the-books commission of 30 percent, which he could chop up and distribute to his brokers in whatever manner worked for him.
At the time Cary had his sit-down with Jeffrey, he didn’t make it known that, as usual, he was swimming in debt. He did, however, borrow $3,000 from Jeffrey, a guy he hadn’t seen in five years, and then he agreed to promote Spaceplex. He told Jeffrey he was working for Diversified Investments, which happened to be run by the president of the Upper East Side co-op where he was currently in residence. Actually he wasn’t really working for Diversified; it was more that he was working with Diversified. He claimed to Jeffrey that Diversified had him on salary, that they had leased him yet another Mercedes, this time a 600 S30 (not in his name) and that he was getting cash “incentives” on the side. He told him they could use Diversified as a cover to make “incentive” payments to the other brokers they recruited.
“It made the paying of the other brokers mellifluous. It made it liquid. It made it easier. It hid the business we were doing. It hid it from every regulator. It hid it from the IRS as well. I could be making large sums of money and not paying taxes.”
He was aware that he was discussing avoiding detection by legal authorities. He knew all about pump and dump. He was aware that he was involved in criminal activity. But he was also aware that so was just about everybody else he came into contact with on a daily basis in the world of Wall Street. And more importantly, it wasn’t just Cary Cimino that really needed the money. Now Cary had another reason to get “flexible” with the law. He had Erin.
All the hours of headache and heartache he’d experienced as a pseudo father to his much younger half-sister had brought with it a kind of benefit he hadn’t foreseen. The more he’d thought about it, the more he came to see there might be some upside to Erin. Perhaps there was something to all this altruism. There was something powerful about having a motive to earn money that was connected to someone else’s well-being. If he was choosing to bend or even break rules, he was only doing it for his baby sister, and who could argue with that? He had obtained a certain lifestyle that he needed to maintain, but now he had a reason quite pure for getting and having. It wasn’t just about Cary. Cary the pseudo father could say for the first time that his pursuit of wealth was now about so much more.
Of course making tons of money was not guaranteed.
While he was there, Sal Piazza stopped by and said hello. They got to talking and the subject of enforcement came up. Enforcement was a critical issue in pulling off a pump and dump scheme. In order for the scam to work, the clueless investors couldn’t be allowed to sell their stock before the insiders sold theirs. Otherwise the price wouldn’t rise and perhaps the whole thing would never get off the ground. In pump and dump, brokers had to keep their customers in line. And the insiders had to keep the brokers in line. Sometimes persuading the brokers to stay on program involved a certain amount of physical force. Cary knew all about this and until now had never really had to think about enforcement. Enforcement usually required the name of one of a certain group of five families.
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