Cary Spivak – Milwaukee Journal Sentinel
Ex-con Barry Minkow who in recent years billed himself as a fraud buster may be heading back to prison.
Minkow was convicted in the 1988 when it was discovered that the company he launched as a teenager was a Ponzi scheme. After his release from prison in the 1990s Minkow became a minister and a self-described fraud buster.
You may recall that Minkow hired Tracy Coenen, a well-regarded forensic accountant, to assist him on several projects that involved looking for fraud by companies. Minkow even launched a now-defunct web site to investigate companies. Prior to posting negative stories on the site, iBusinessReporting.com, Minkow would short the stock of the companies — that is, he made a market bets that the value of the company stock.
The charges are not related to iBusinessReporting. Rather, it involves an investgation by Minkow of Miami-based homebuilder Lennar Corp. When the negative report, which contained false allegations, was released the company’s stock dropped by about 30%.Minkow’s lawyer says his client faces up to five years in prison, though he predicted the actual time would be closer to 15 to 24 months, the Journal reports.
Coenen is not involed in the case. Even when she did work for Minkow, Coenen publically criticized him for trading on companies prior to posting negative information about the firms.
Meanwhile, Hollywood sees a silver lining in Minkow’s dark cloud. A movie about his life starring James Caan and – of course – Minkow was shown at the Berlin International Film Festival this month and was to be offered to distribuors at the upcoming Cannes Film Festival. Now, the director says the ending will have to be rewritten, though the LA Times quotes him as basically saying that could be a good thing.