Making Crime Pay

Before he was arrested and convicted of the murder of his wife, David A. Brown of Garden Grove collected $835,000 in insurance payments. That was nothing, however, compared with what the author of a book about the case took home.

Ann Rule’s account of the 1985 crime--a lurid tale involving a teenage girl who killed her stepmother at her father’s behest--and subsequent developments in the case became the best-selling “If You Really Loved Me,” part of a two-book deal that paid Rule $3.2 million in fees.

The ethical issues raised by Rule’s vocation are ones the author, believed to be 60ish, has wrestled with since early in her crime-writing career 30 years ago as a stringer for True Detective magazine.

“I thought: ‘Oh my God, I’m making a living from somebody else’s tragedy. Can I do this?’ ” Rule recalled. The question so haunted her that she turned to a psychiatrist, who told her that many people--including police, morticians and lawyers--face the same ethical dilemma. The doctor emphasized to her that what mattered was her feelings toward the victims.

“I really care about the people I’m writing about,” says Rule, whose accounts focus as much on the anguish of the victims and their families as on the depravity of sociopathic killers. “I finally came to the knowledge I’m doing what I probably was meant to do in life.”

Whatever else it may be, Rule’s calling has been immensely lucrative for her, bringing in millions of dollars annually. Besides the fees for each book--she has written about a dozen, some of which became bestsellers--there are royalties, paperback rights, and film and television sales.

If there’s an ideal family background for a true-crime writer, Rule’s is it: She grew up in the East and Midwest surrounded by relatives involved in various aspects of law enforcement: a grandfather was a sheriff, an uncle was an undersheriff, another uncle was a medical examiner, and a cousin is a prosecutor.

In 1975, Rule was a single mother living in the Pacific Northwest and rearing four school-age children. She was freelancing for various magazines for $200 an article, building a reputation as a true-crime writer, when she became fascinated with the fact that there was a then-unknown serial killer preying on women in the area. She signed a $10,000 contract to write about the case, but the caveat was that there would be no book unless a suspect was arrested.

Imagine Rule’s shock when the suspect turned out to be a friend and former co-worker on a Seattle suicide hotline: Ted Bundy. Her personal knowledge of and prison talks with Bundy led to the riveting book “The Stranger Beside Me,” published in 1980.

It was the book that made her career. The paperback rights sold for a remarkable $125,000, and her first royalty check was for $54,000. Ultimately, the book, which has sold more than 2 million copies and is now in its 33rd printing, has garnered Rule more than $1 million in royalties so far. Not bad for someone who grew up hearing tales of family hardship during the Depression.

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A few years later, Rule’s “Small Sacrifices,” about the 1980s case of an Oregon mother who shot her three children in hopes of pleasing a lover, received an advance of $220,000 and was eventually adapted as a TV miniseries starring Farrah Fawcett. Other contracts followed, their dollar figures routinely climbing into the millions.

When the crime writer first began to earn significant sums of money, she turned them over to a stockbroker to deal with. But then some time later she saw a segment on a newsmagazine show about stock churning--that is, brokers’ executing client trades solely to earn commissions.

“I really didn’t know about commissions,” Rule recalled. Rule looked more closely at her financial statements and suspected that there had been excess trading going on in her accounts. She promptly fired her broker.

Mutual friends recommended another broker. That didn’t work out either. When Rule informed the woman that she was hiring another advisor as well, the broker hung up on her. “I just thought she was looking out for my interests, but she wasn’t. I’m smarter now,” Rule says.

Today, Rule works with a financial planner, two stockbrokers and an accountant. She says learning how to stay on top of her money--how to keep an eye on the people entrusted with it--has been a lot harder than earning it.

Rule describes herself as a conservative investor with a strong interest in municipal bonds and certificates of deposit. As you might expect, almost all the stories she tells of her financial acuity concern the stock market.

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Yet, as with many investors, her memories of her successes and failures tend to be a bit exaggerated. Case in point: QVC.

Several years ago, Rule found herself watching quite a bit of the shopping channel. Soon, she was also doing quite a bit of buying from it too. There was Joan Rivers’ costume jewelry, blouses from designer Diane Von Furstenberg and television sets. “I would hear all these people calling in all day, and they were so enthusiastic, and I thought, ‘This looks good,’ ” Rule said.

So she bought 300 shares of QVC stock for about $6,000, or about $20 a share. Rule said she made a tidy profit when QVC returned to private hands in the mid-’80s, when shareholders were bought out at $70 a share.

Actually, shareholders were bought out at $46 a share.

Rule laughed when informed of the discrepancy. “I could swear it was $70. Well, I’m still happy with my illusions.”

As a longtime resident of the Pacific Northwest, Rule likes her portfolio to include a healthy sampling of companies based there. She owns shares in Microsoft and Boeing. She owned stock in Nike too, but sold it before the current downturn in sneaker-company fortunes.

She’s also a fan of Seattle’s Starbucks, and says she moved heaven and Earth to get in on its initial public offering in 1992. Initial public offerings are normally very difficult for the average individual investor to access. The stock has increased in price more than 300% and split twice since her purchase. It is currently trading at around $38 a share.

“It’s nice to own hometown stocks,” Rule says. But not always profitable. The author bought shares in Portland, Ore.-based Macheezmo Mouse Restaurants a few years ago after reading a newspaper article about the small restaurant chain that sells health-conscious Mexican fare. She admittedly did no further investigation of the stock, which she says she bought when it was trading near its high of $10.38 a share on Nasdaq. Rule jettisoned the stock, since delisted, at a little more than $1 a share. It now trades for pennies.

Rule also has been dabbling in real estate, with a success that can be described as mixed at best. In 1976, before her book-writing career really took off, she found a home to fall in love with. She paid $46,500 for the four-bedroom residence--located directly under a SEA-TAC flight path. Her son Michael now occupies the house. Getting the mortgage was an adventure, as it can be for many people who are self-employed.

“I had to prove to the loan company what I did for a living,” Rule recalled. “So I got a big stack of magazines and the New York Daily News, and I went into the loan company and told them, ‘This is what I do for a living.’ In one magazine, I had three different stories under three different pseudonyms. So I said, ‘I made $278.50 from this, and $312.50 from that.’ ”

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Rule bought her current home, a spacious affair right on the Puget Sound, in 1989 as a treat for herself. She says she loves living there. This despite the fact that the property suffered several hundred thousand dollars in damage during two successive mudslides a year ago. Although her insurance company is paying for only a small fraction of the damage, she says, Rule plans to make the repairs and continue living in her waterfront dream home.

Part of being a successful entrepreneur, which Rule is in a way, is dealing with taxes and the responsibilities of having employees.

She incorporated in 1989 and now pays health and pension benefits to her three part-time employees (although two of them are her children), who help with research, publicity and other tasks. The first bill she pays, she says, is always the tax bill. “I don’t consider it money until my taxes are paid.”

Rule is known as a hard worker and ceaseless promoter of her books. She is currently on a book-signing tour for her latest, “Bitter Harvest,” the Medea-like tale of Dr. Debora Green, a Kansas woman who set her house afire in attempt to kill her three children after her husband left her for another woman.

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Helaine Olen is a regular contributor to The Times. She can be reached at holen@aol.com. Money Profile columns run occasionally instead of the usual Money Make-Over column.