Saturday, March 17, 2018

Crime and Punishment: A Stroll In the Vicinity of Wall Street

From Institutional Investor:

Here’s your guide to a serpentine stroll in the vicinity of Wall Street.
To our knowledge, there is no published Baedeker (save for, perhaps, a subtext of Den of Thieves) devoted to introducing residents, visitors, and day laborers to the rich history of Wall Street malfeasance — financial or otherwise. To remedy this, we offer a serpentine stroll from the corner of Broad and Pearl streets up to Wall Street, around a few corners, and ending across from 1 Liberty Plaza. While we admit our crime crawl is somewhat arbitrary and we are totally guilty of omitting numerous boldface firms and scoundrels beyond the immediate vicinity, we present an entertaining way to spend a lunch hour this spring.
54 Pearl Street - Fraunces Tavern
Were there a Yelp back in 1774, founding father John Adams would have given Fraunces Tavern five stars. “The most splendid dinner I ever saw,” said Adams, a member of the First Continental Congress who visited the tavern, according to its website. Back in the day, lodging and postal services were also available. In 1798 the Gardie family, late of France, were in residence. At some point in the middle of the night, Monsieur stabbed Madam to death and then himself. Imagine that — a crime of passion, not profit, in the neighborhood of Wall Street. 

85 Broad Street - Goldman Sachs

The New Yorker’s Adam Gopnik described it as “one of those bland, squint-windowed, stone-fronted 30-story monstrosities.” Goldman Sachs Group lived here from 1983 to 2009. Its golden reputation was besmirched in February 1987 when Robert Freeman, head of arbitrage, was led off the trading floor, the first of a hat trick of arrests orchestrated by the office of U.S. Attorney for the Southern District of New York Rudolph Giuliani. The threesome were part of a tangled web that began to unweave with the 1985 arrest of Dennis Levine, who implicated Ivan Boesky, who dimed out Martin Siegel, who fingered Freeman et al. For Goldman, the bloom was off the rose. 

60 Broad Street - Drexel Burnham Lambert

While golden-boy employee Michael Milken was on the West Coast pioneering the junk-bond market, there was no paucity of hanky-panky at Drexel Burnham Lambert’s home base. Frederick Joseph led the charge to raise Drexel into the pantheon of top-tier investment banks, succeeding for a while. The firm’s demise began in 1986, thanks to the aforementioned Boesky. In 1989, Drexel Burnham Lambert owned up to six felony counts. Milken was indicted on 98 counts of racketeering and securities fraud. In early 1990 the firm filed for bankruptcy. Still standing tall is its former headquarters building, which today boasts a LensCrafters Optique, an Au Bon Pain, and a Pret a Manger on the ground floor. ...MUCH MORE

HT: Barry Ritholtz