Minkow Weeps on Stand, Says He Was Coerced by Gangsters
Former carpet-cleaning whiz kid Barry Minkow wept today as he testified that gangsters and loan sharks held such control over him that they were guaranteed to profit even if he died.
Minkow, 22, testifying in his securities fraud trial, told jurors that days before his company, ZZZZ Best, collapsed in scandal in July, 1987, reputed loan shark Daniel Krowpman forced him to sign an agreement that assured Krowpman a huge income.
Minkow said Krowpman, who loaned him $1,600 at a high interest rate to start ZZZZ Best, wanted to cover up his role in the firm. The agreement said Krowpman had loaned Minkow $50,000 to start the company and “for services rendered.”
It said Krowpman had accepted 500,000 shares of stock for the $50,000 loan and now agreed to sell the stock for $2 million. The document also guaranteed him a $200,000 annual salary and full payments on his health insurance and Cadillac.
Breaking into tears, Minkow testified that Krowpman also made him sign an addendum specifying that Krowpman’s benefits would be collected from Minkow’s estate if “anything should happen” to him.
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