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October 22, 2009

Cornwell sues advisers; claims millions in losses

patrcia cornwellPatricia Cornwell, who has created a literary empire with her crime-solving character Kay Scarpetta, is suing her financial advisers, claiming that they burned through tens of millions of her money since 2005. (And you thought your 401(k) was in the toilet.) The federal lawsuit against Anchin, Block & Anchin LLP, detailed on The Daily Beast. makes for some interesting reading. The complaint notes that Cornwell is bi-polar, has her own helicopter and makes more than $10 million per year. It also questions a $5,000 check to adviser's daughter for her Bat Mitzvah, and says the adviser told Cornwell and her partner, Dr. Staci Gruber, to pose as Middle Easterners to lease a New York apartment.

From the complaint: -- "Ms. Cornwell is a best-selling crime novelist whose ability to write is dependent upon the ability to avoid distractions. A quiet, uninterrupted environment, free of the distractions of managing her business and her assets, was essential to her ability to write and to meet her deadlines. Further, Ms. Cornwell openly acknowledges her diagnosis with a mood disorder known as bi-polar disorder, which, although controlled without medication, has contributed to her belief that it is prudent for her to employ others to manage her business affairs."

-- "In July of 2009, after four and a half years in which Anchin controlled Ms. Cornwell’s and CEI’s business affairs and investments ... Ms. Cornwell demanded information as to her net worth, and that of CEI. Notwithstanding eight figure earnings per year during that period, CEI and Ms. Cornwell learned that their net worth, while substantial, was the equivalent of only approximately one year’s net income. They also learned that Anchin had borrowed on their behalf collectively several million dollars, comprised of mortgages for real property and a loan for the purchase of a helicopter."

-- She questions "an electronic check for cash in the amount of $5000, with a memo line indicating that it was a gift from Ms. Cornwell to Mr. Snapper’s daughter (whom Ms. Cornwell has never met) on the occasion of the daughter’s bat mitzvah."

-- Anchin was involved in "entering into a sublease on Fifth Avenue under circumstances where Ms. Cornwell and Dr. Gruber were told by Anchin after Anchin entered into the lease that they would have to pose as the cousins of the tenant, who was Middle Eastern, even though Ms. Cornwell and Dr. Gruber are both fair in complexion and hair and eye color, and do not even remotely appear to be Middle Eastern."

Posted by Dave Rosenthal at 11:26 AM | | Comments (6)
        

Comments

Seriously. Having read the full complaint, these women might be the stupidest people on earth. It's not hard to see how or why they were robbed and really, that kind of neglect and stupidity deserve to be punished.

I am disappointed to learn of this neglect on Patricia's part. (i expected better). I am not familiar with Dr Gruber. But shame on her as well. I would not wholly trust anyone with my finances. It's a dog eat, dog world out there.No one is that trustworthy. Step up to the plate ladies. Take control!..

I had a friend who owned a liquor store, and he had one rule for operating his business: Always have family at the cash register.

actually, these ABA folks have been in trouble before so this looks really awful. Cornwell and Gruber hired them to manage money, and clearly, they managed to take whatever they wanted.

Patricia, you gonna give Margo half of the money you get back.

ABA has a corporate culture that promotes this behavior. They have purchased smaller firms to increase the size of their client list ... . Pigs get fed, hogs are slaughtered

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About the blogger
Dave Rosenthal came to The Baltimore Sun as a business reporter in 1987 and now is the Maryland Editor. He reads a wide range of books (but never as many as he'd like), usually alternating between non-fiction and fiction. Some all-time favorites: A Confederacy of Dunces by John Kennedy Toole; Wind, Sand and Stars by Antoine de Saint-Exupery; and anything by Calvin Trillin or John McPhee. He belongs to a book club with a Jewish theme.
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