The sequel to Drexel Burnham Lambert’s “Predator’s Ball”
|Nov 1||Public post|| 4|
Second in a series. Read Part 1: The worst company in Wall Street History and the NBA.
BY HENRY ABBOTT
What if bad guys truly were like Bond villains? A cat, a yacht, a scheme, a giant pile of illicit cash. Or a mobster with cigars whose little nod ends a life.
They wouldn’t act alone, of course. Strings of judges, senators, executives, police captains, and the like would be bribed, coerced, or entrapped on their side. That’s how evil schemes work.
Politicians in movies like that are usually portrayed as phonies or puppets; saying something idealistic at a podium while running their fingers over the briefcase full of cash in the backroom.
I don’t know if the world really has Bond villains. But it for sure has crime, and it for sure has illicit dollars. The image of the Bond villain might be nutty, and the dollars might not be in a briefcase. But in the real word, dollars are moving, and some power brokers are in on it.
At one time, it perhaps seemed paranoid to worry. But things are a little different. Now so much of the world’s wealth is untraceable—nearly a tenth of all money, as we have discussed before. It’s boom time for dirty dollars. It’s getting hard to find anyone with a clean bill of wealth.
Drexel Burnham Lambert’s Michael Milken used to hold a party that The New York Times says was nicknamed the “Predators’ Ball.” Then he got in trouble for all kinds of crimes and went to prison. As I read on my couch on Sunday, though, Milken has been doing very well since getting out of prison. It turns out that in the exact hotel where Milken once held the Predators’ Ball, his deep-pocketed non-profit now runs an annual conference. It’s a hailstorm of names and dollars circling the White House, Trump’s businesses, Jeffrey Epstein’s social circle, and the governors of some NBA teams—under an umbrella of celebrities and academics.
The stated mission is “to deliver novel, collaborative responses to these great questions of our time.” It’s also a place where people like former Commerce Secretary Wilbur Ross (who has “crony connections” to figures around Vladimir Putin) gets to share a bill with, I kid you not, Elmo. Another speaker: Treasury Secretary Steven Mnuchin, who forgot to disclose $100 million in assets and an offshore entity to Congress. Or, my favorite: Ozark stars Jason Bateman and Laura Linney. Ozark is a Netflix drama about money laundering.
The Milken Institute’s annual conference is such a giant deal that even though Jared Kushner and Ivanka Trump live at the corner of influence and money, the Times suggests that their prominent positions at this conference are a benefit to them, not the other way around.
As it happens the general ass-kickery of the A-list attendees also makes this a hotbed of NBA networking.
Retired player Caron Butler was on the speaker list, as was former player and executive Joe Dumars. Magic Johnson was on an invitation-only panel about sports ownership. He was joined by the Nets’ new governor Joe Tsai and Gerry Cardinale, who runs RedBird Capital—the company that TrueHoop sources say brokered Josh Kushner’s purchase of a stake in the Memphis Grizzlies.
Everything about it feels very clubby and insidery. Josh Kushner has family connections with, at the very least, the potential for sweetheart deals. Todd Boehly once flirted with making a deal with Prokhorov for the Nets, and owns part of the Dodgers and Sparks. Also on the panel was Patrice Motsepe, who has family connections to elite South African politicians, and reportedly purchased a series of mines at advantageous prices. An inordinate amount of wealth, these days, comes from proximity to political power.
TrueHoop readers already know who Leon Black is. Of course, he spoke at the conference. He worked with Milken at Drexel. After its collapse, he was able to quickly raise the money to found Apollo. He has documented ties to Jeffrey Epstein (Epstein was reportedly at a party at Black’s house as recently as 2015). And his fellow Apollo founders are two former Drexel figures who are now NBA governors: the 76ers’ Joshua Harris and the Hawks’ Antony Ressler.
The Milken Institute also featured another former Drexel figure: Antony’s brother Richard Ressler. As TrueHoop previously discussed, Richard Ressler’s CIM Group invested in Trump SoHo alongside Bayrock, Tevfik Arif, and the deceased Tamir Sapir.
The guest list also digs up some new NBA connections to Milken’s world. Thomas Barrack is a longtime, close business associate of Donald Trump. He reportedly introduced Trump to Paul Manafort (who has had the most incredible career among criminals), and to key sources of overseas investment. In the late 1980s, both Barrack and Bucks governor Marc Lasry worked for investor Robert Bass.
Dizzy yet? That’s part of how it works. Who can follow all these spider-webbing connections? Indulge me in another one, though: Elaine Chao is the U.S. secretary of transportation. She spoke at the conference too. Her actions recently raised ethics questions around her family’s lucrative China-based business; a business said to be the primary source of income for Chao and her husband.
Chao’s husband happens to be Senate Majority Leader Mitch McConnell. Her family’s business is run by her sister Angela Chao, who is married to Celtics investor Jim Breyer. Breyer is venerated in the world of venture capital; and played a leading role in connecting startups with money from Russia and China, including a massive investment in Facebook that reportedly included money from a convicted criminal with mysterious sources of cash, Alisher Usmanov. According to this WIRED story, serious government investigators have profound worries about how Usmanov’s company, Mail.ru, could have transferred sensitive social media data to Russian intelligence.
The whole Bond villain thing now seems a little less crazy than it did at the beginning of this story.
In 2008, Jeffrey Epstein’s attorneys negotiated a mind-blowingly friendly plea deal. Epstein had mind-blowingly powerful attorneys, including George W. Bush’s special envoy to North Korea Jay Lefkowitz, Harvard professor Alan Dershowitz, former U.S. Attorney Guy Lewis, and former independent counsel Kenneth Starr who famously investigated Bill Clinton during the Monica Lewinsky scandal.
How did Epstein attract the likes of Dershowitz? Connie Bruck of The New Yorker has explored the possibility Dershowitz was effectively corrupted. Did Epstein (or whoever was really the source of Epstein’s mysterious fortune) have leverage over Dershowitz that compelled the star lawyer to help?
Gerald Lefcourt is another star attorney who worked with Dershowitz on Epstein's 2008 deal. His story strikes me as a metaphor for this whole charade.
Lefcourt made a name for himself working largely pro bono, representing Black Panthers and Abbie Hoffman. But by the 1990s, he had changed his tune and came to be involved with Drexel. It was decidedly less idealistic. Lefcourt’s Drexel client was Bruce Newberg, who was convicted of racketeering and fraud. In the court documents is a transcript of Newberg and his compatriot evidently arranging to manipulate a stock. They finish the conversation with Newberg saying, “You're a sleaze bag.” To which his buddy replied, “You taught me, man.”
According to the New York Post, as a thank you for his work in 2008, Epstein reportedly donated $250,000 to Lefcourt’s preferred non-profit, the Foundation for Criminal Justice. In the foundation's publication, The Champion, Lefcourt is quoted saying: “Obviously I am not standing on tables shaking my fists,” he says. “I am not picketing the White House.”
Think about it. A publication that purports to champion justice was paid for, in part, by Epstein, whose victims are still seeking justice. A lawyer once celebrated for speaking truth to power was, in this case, successful by speaking power to truth.
I’m generally worried about an economy that, at the top, is driven by dollars from unnamed corporations. I’m specifically worried about this collection of characters around Drexel, Apollo, Trump, and Epstein—which includes some NBA governors.
Who knows if times were ever better, but they were surely simpler. How did Larry Miller make the money he used to buy the Jazz? From selling cars, and by going to banks and asking for loans. I at least understand that.
How did Antony Ressler get the money to buy the Hawks? There might never be a plain-English explanation. It doesn’t mean it was shady, but it means whether it was or wasn’t, it would look about the same from this distance. (I’ll give you a cookie if you can summarize this business biography in plain English.)
It warps us all a little. We don’t even know if we are cut into the world of shady dollars. If you work at a bank, you might be. Or at a big tech company. Or for a lawyer or an investment firm. Or in many jobs in real estate. If you’re cut in, even a little, your own brain wants to make it all seem normal. There’s a scene in Silicon Valley where a startup under stress has an offer, as The New York Times’ Farhad Manjoo tells it, “... to take a billion dollars from a Chilean investor with ties to the Pinochet regime.” Eventually, the team gets to the business of rationalizing:
“Even if this is wrong, I suppose you could argue that it’s wrong in the service of rightness,” Jared suggests.
Richard chimes in with rising approval: “It’s unethical in the defense of ethics. Unjust in the quest for justice.”
Jared: “It’s like stealing from your pimp to pay for your friend’s appendectomy.”
In case you missed it: David Thorpe is drawing on screenshots to teach things about NBA hoops!