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The Biz: The scoop on business newsmakers

Charlie's girl lived it up as ex-husband made millions

There are plenty of back stories emerging from the highly publicized sightings and announced wedding plans of Florida Gov. Charlie Crist and New York socialite Carole Rome. It's been suggested this is a pairing of political expediency to help Crist toward a vice presidential spot on the John McCain ticket, or a rebound romance for Rome following her divorce from businessman Todd Rome.

Documents chronicling the Rome divorce are telling. The Romes married in 1993, and court files portray how Carole Rome has since enjoyed a "luxurious and lavish" lifestyle, with a personal driver in New York and Florida, nannies and second and third homes.

Todd Rome says in court files that his ex-wife had insatiable spending habits and a habit of becoming dissatisfied with a new home as soon as it was built. "In the first 11 years of our marriage, we lived for an average period of one to two years in a succession of no less than five apartments and three houses," Todd Rome states. He estimates she earns about $1.5-million a year.

What isn't elaborated upon is the unusual history of Todd Rome's business career. He's a huge fan of the 1987 movie Wall Street because he appreciates the aggressive investment style of the Gordon Gekko character played by Michael Douglas. He liked the movie enough to name his current business — Blue Star — of brokering private jet flights for rich people after the movie's fictitious airline that was the target of a hostile takeover attempt by Gekko. "It's our generation's favorite movie," Todd Rome has said in interviews.

Todd Rome and business partner Ricky Sitomer started in the securities business in 1990 with Stratton Oakmont, a brokerage shut down by regulators for fraud after they left. Since then, Stratton's infamy has soared as a boiler room operation specializing in classic high-pressure, "pump and dump" stock selling. Stratton Oakmont founder Jordan Belfort published a tell-too-much, catch-me-if-you-can book last year called The Wolf of Wall Street that portrayed a snub-the-rules, manipulate-the-client world full of easy money and drugs.

Rome and Sitomer in 1994 opened their own firm, Millennium Securities. In 2001, the firm settled a case brought by the National Association of Securities Dealers accusing it of making $5-million in illegal profits from a 1996 initial public offering. The firm agreed to give back more than $1-million, while not admitting or denying wrongdoing. Sitomer was the target of 33 complaints from clients, who recouped more than $1.5-million, and was barred from the securities industry.

Superhero's effort called for to turn around Wachovia

Is Bob Steel a Man of Steel? He may need some superpowers in his new role as CEO of giant-but-beleaguered Wachovia Bank, a North Carolina institution that also happens to be one of the largest banks operating in Florida. Not only has Wachovia's stock been battered, but just last week the headquarters of its Wachovia Securities unit in St. Louis was being probed by regulators looking at its auction-rate securities sales practices. Steel, 56 and a former U.S. Treasury official and Goldman Sachs executive, succeeded Ken Thompson, who was ousted in June.

It may take Pearlman a while to repay $300M at $1.15 an hour

Lou Pearlman and federal authorities last week agreed on how much the former boy band promoter swindled from banks and investors in a decadeslong scam: $300-million. That's how much he's supposed to repay, at a minimum, for restitution on the fraud conviction for which he's serving a 25-year prison sentence. Investigators have found Pearlman's money is apparently gone with the collapse of his Ponzi scheme.

There's always his pay from a prison job. That could range from 12 cents an hour to $1.15 an hour for top-scale factory work. Scammed investors are not holding their collective breath.

Times Staff Writer

The Biz: The scoop on business newsmakers 07/21/08 [Last modified: Thursday, July 24, 2008 11:09am]
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