Minkow Seeks Comeback Former Swindler Tries To Gain Respectability
Robert Barker reacted predictably when his daughter went sweet on Barry Minkow, the former carpet-cleaning boy wonder whose ZZZZ Best was one of the 1980s’ most celebrated swindles.
“I got a bruised forehead out of it, from bouncing off the ceiling,” the Phoenix businessman recalls. “Don’t even mention his name around me!” he told daughter Teresa, 22, when she asked to visit Minkow at federal prison.
But she was adamant. And Minkow, now an evangelist who says he wants to repay victims $26 million, is singularly persuasive.
How many other 20-year-olds from modest San Fernando Valley backgrounds could have conned talk shows, Wall Street and top accountants into believing ZZZZ Best - built on lies, embezzling, check kiting and mob money - was worth $240 million?
Freed last December from Lompoc, Calif., federal prison after 87 months behind bars - more than financial felons Michael Milken, Ivan Boesky and Leona Helmsley combined - he holds himself up as a lesson in how small compromises spiral into webs of deceit.
Believers include Barker, some victims and his former prosecutor.
“It takes a strong person to sit and look right at you and not turn his head away when you ask the kind of questions an angry father can ask,” says Barker, who wound up blessing his daughter’s marriage to Minkow.
“He is a man I have come to respect.”
Minkow, 29 and out of a halfway house since April, is one of the busier ex-cons. He was billed as the star speaker Thursday at a bank fraud seminar sponsored by the FBI’s Los Angeles office. Four hundred financial executives were expected to attend. Minkow will not be paid.
In conversation, he pours out persuading floods of words, locks eyes, offers a reassuring knee pat. Minkow, who once demanded his parents call him “mister,” reveals the effects of prison by saying “sir” when answering tough questions.
He says how-to-succeed books teach people the small ethical compromises that fester into corruption.
“I didn’t start out to cheat anyone. I told myself that all I was doing was making my payroll.”
Starting at age 16 in his parents’ garage with his mother as his first employee, Minkow aimed to become the General Motors of carpet cleaning. He was about to buy Sears’ national business when his scams collapsed.
In 1988, he was convicted of 57 counts of defrauding investors and banks in a classic Ponzi scheme, using money from new investors to pay old debts. His biggest scam was persuading everyone he made millions of dollars restoring fire- and water-damaged businesses. There were no such jobs.
Minkow now earns some money running errands for the lawyer who represented him and meets Christian groups while establishing his new business: giving “Fraudo Dynamics” seminars and marketing videotapes nationwide to help accountants and corporate directors spot scams.
Earnings go to a trust fund audited by an arm of the big accounting firm Coopers & Lybrand that, you can bet, will be on guard this time.
Minkow and his bride will get enough to live on, with the rest going to his victims. Details have yet to be arranged. But probation officers say Minkow, who once drove a red Ferrari and owned a $700,000 home, won’t be buying new cars or a house any time soon.
All the profits from a book written over three years in prison, “Clean Sweep,” already are going toward his $26 million restitution order.
He says his goal is becoming a full-time preacher after repaying victims over three to five years. He says he has controlled the ego and craving for attention that once led him to crime. He’s glad he won’t be tempted by touching his earnings himself, he adds.
Not everyone is convinced.
“I’ve been doing this too long to expect any change,” says U.S. District Judge Dickran Tevrizian, who handled Minkow’s case. “(Minkow) doesn’t know right from wrong - he’s an alchemist.”