Millionaire Is Charged With Stealing From Client’s Funds
Alberto Vilar, the multimillionaire New York money manager and benefactor to the world’s leading opera and ballet centers, was arrested late Thursday and charged by U.S. authorities with stealing $5 million in client funds, which he allegedly used to pay bills and continue his philanthropy.
The financier, who reported a net worth of $950 million in December, according to prosecutors, is accused of using an investor’s funds to make donations to Washington & Jefferson College in Washington, Pa., and for payments to caterers and a dishwasher repair company, according to a complaint made public Friday in federal court in New York.
Vilar, 64, used the unidentified client’s investment in 2002 “as a personal piggy bank to pay personal expenses and make charitable contributions, without the knowledge, consent or authorization of the victim,” U.S. Postal Inspector Cynthia Fraterrigo said in the complaint.
Vilar, founder of New York-based Amerindo Investment Advisors, was taken into custody at Newark Liberty International Airport in New Jersey after returning from Las Vegas, prosecutors said. He is in custody, having failed to post a $10-million bond to make bail.
Gary Tanaka, Amerindo’s co-founder and co-chief executive, who lives in London, also was charged Friday. Authorities said he stole from investors and used the money to buy racehorses.
Vilar gave more than $200 million to opera groups, medical institutions, and Washington & Jefferson, his college, the complaint said, citing news reports. His New York-based Amerindo Technology Fund has fallen 17% this year after gaining 24% last year and 85% in 2003. From 2000 to 2002, the fund lost more than 90% of its value.
“This is a case which involves staggering amounts of money,” U.S. Magistrate Judge Henry Pittman said as he ordered Vilar held without bail until a hearing Tuesday.
“Assuming the defense counsel’s representation is right, he is worth $100 million. If he were able to flee with just 2[%] or 3%, that is probably enough for him to live out the rest of his life in comfort in many parts of the world.”
Susan Necheles, a lawyer who appeared in court with Vilar, told Pittman, “He believes the charges here in this case are wrong.”
“Amerindo is shocked over the events of the past two days,” said Eugene Licker, a company lawyer. “The company is mindful of the presumption of innocence and awaits the outcome of the government’s investigation. In the meantime, Amerindo is cooperating fully with the government and will continue to do so.”
In a subsequent hearing, U.S. District Judge Harold Baer set bail for Vilar at $10 million. Necheles said Vilar would not be able to raise the funds needed to post a bond.
Philip Weinstein, a court-appointed attorney for Tanaka, could not be reached for comment.