WONDER BOY: Barry Minkow--The Kid Who Swindled Wall Street by Daniel Akst

WONDER BOY: Barry Minkow--The Kid Who Swindled Wall Street

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Another judgment on Barry Minkow, the teen-age sociopath who created a bogus enterprise that dearly cost investors, lenders, and other trusting souls. Like Joe Domanick, who has also produced a vivid version of the Wunderkind's swift rise and hard fall (Faking It in America, p. 1132), Akst covered the latter stages of his subject's criminal career, first as a Los Angeles Times columnist and later as a Wall Street Journal correspondent. In 1984, when he was just 18, Minkow (founder of ZZZZ Best Carpet & Furniture Cleaning Co.) began promoting himself as an entrepreneurial prodigy. An unwary press soon gave his shoestring operation credibility enough to attract support from bona fide (if avaricious) auditors, bankers, and underwriters--a welcome switch from the mob-connected loan sharks who provided start-up funds. Unfortunately, the fledgling firm turned out to be a decidedly dirty business whose specialties were booking nonexistent orders, laundering drug money, kiting checks, evading taxes, forging financial statements, and other forms of racketeering. The long-lived swindle began to unravel in mid-1987, when more vigilant journalism disclosed that the misbegotten Horatio Alger (who was making regular appearances on national as well as local TV) had been involved in a credit-card fraud. In relatively short order, ZZZZ Best went into receivership, and the price of its high-flying shares plunged. Minkow and his accomplices wound up behind bars, but their incarceration affords at best cold comfort for the scam's victims, whose losses the author reckons at over $100 million. As is the case with Domanick, Akst offers precious little analysis of the scandal's implications. His smooth reportage on the youthful high roller's fiscal chicanery, however, is equally riveting and cautionary.

Pub Date: Feb. 1st, 1989
Publisher: Scribners