NEW YORK -- Alberto Vilar and Gary Tanaka stole millions of dollars from Amerindo Investment Advisors Inc. clients, in one case cutting and pasting a client's signature to steal $250,000, a prosecutor told jurors Monday at the start of the men's federal fraud and conspiracy trial.
Vilar, 67, and Tanaka, 65, were arrested in 2005 on charges they stole $5 million from Lily Cates, mother of actress Phoebe Cates. Prosecutors claim they used phony investments to defraud Cates and at least four other clients.
"They worked together to defraud their clients and to steal their money," Asst. U.S. Atty. Benjamin Naftalis argued in opening statements. "This case boils down to knowing the difference between right and wrong."
Vilar, a one-time major donor to opera companies in several countries, and Tanaka are charged with 12 counts of conspiracy, securities fraud, investment-advisor fraud, mail fraud, wire fraud, money laundering and lying to the U.S. Securities and Exchange Commission. The most serious charges carry a possible sentence of 20 years in prison.
Both men have pleaded not guilty.
Naftalis told a jury of six men and six women that Vilar and Tanaka persuaded Cates in 2002 to invest the $5 million in a government-backed small-business investment program. Instead, Naftalis said, they used her money to pay off another Amerindo client, for company expenses and for Vilar's own personal bills.
Herald Price Fahringer, a lawyer for Vilar, said in his opening statement that neither his client nor Tanaka were "scam artists or looking to take $5 million from Lily Cates."
Until a few years ago, the Cuban American Vilar had been hailed as an international arts patron, making multimillion-dollar pledges to Los Angeles Opera, the Metropolitan Opera in New York, the Royal Opera House in London and other companies. But as his legal and financial troubles mounted, he failed to deliver on many of the promises. The $12-million L.A. Opera donation never materialized.