WSJ: Behind Bars, a Cat-and-Mouse Game [Swindler Thomas Quinn]
sufaud
LAW
January 8, 2011
Behind Bars, a Cat-and-Mouse Game
Prison Doesn't Slow Swindler Thomas Quinn; 'The Ponytail' and 'The
Bulldog'
By JOHN R. EMSHWILLER
International swindler and convicted criminal Thomas F. Quinn sits in
a Texas federal prison awaiting trial on an alleged multimillion-
dollar scam. But that doesn't mean he can't stay busy in what
authorities believe are fraudulent outside dealings involving "The
Ponytail," "The Skier," and "Bubble Eyes," among others.
Those monikers, federal officials say, were used by Mr. Quinn in
telephone conversations from the prison to describe apparent business
associates and dealings that ranged from selling assets to collecting
debts. The calls, routinely and openly recorded by prison authorities,
provide "abundant reason to believe that Quinn is continuing to engage
in fraud," said a Nov. 30 filing by the Securities and Exchange
Commission in a Dallas federal court.
In the pending criminal case in Dallas federal court, prosecutors for
the U.S. attorney's office for the Northern District of Texas in
Dallas charge Mr. Quinn with helping orchestrate a $50 million fraud
against major telecommunications companies that allegedly involved
buying large amounts of long-distance telephone time for resale to the
public and then not paying the suppliers, in what is known as a "bust-
out" scheme. He has pleaded not guilty and is scheduled for trial in
February. Mr. Quinn was the subject of a Wall Street Journal profile
last March.
Mr. Quinn's prison calls, the filing adds, "are a veritable potpourri
of code, colorful nicknames, cryptic references and other devices"
that appear to be part of an illegal effort by Mr. Quinn to hide
assets, according to the filing. Federal officials believe that the
Quinn assets include racehorses, a French Riviera villa and other
holdings stretching from Ireland to Istanbul to the Bahamas.
In a court filing, attorneys for Mr. Quinn said the SEC "incorrectly
transcribes and/or mischaracterizes a number" of the phone calls and
"erroneously extrapolates" to support "misguided speculations" of
criminal conduct. A Bureau of Prisons spokesman declined to comment on
Mr. Quinn's phone use. An attorney for Mr. Quinn and the SEC both
declined to comment.
The case is the latest chapter in a decades-long, cat-and-mouse game
between Uncle Sam and Mr. Quinn. The 73-year-old New York native has
two U.S. criminal convictions, another in France, his longtime base of
operations, and three SEC injunctions since 1966. Prior to his current
arrest, he has spent about six years in prison, mostly in Europe.
Federal officials estimate he has stolen more than $500 million
overall.
The SEC's current interest traces back to a 1989 securities-fraud suit
in Chicago federal court and the agency's mostly unsuccessful effort
to collect on a $26 million judgment it won against Mr. Quinn. With
interest, the tab now exceeds $56 million, said the SEC in a filing.
Hampering the collection effort, say current and former federal
officials, were the swindler's globe-trotting, talent for hiding
assets and frequent use of aliases, including Pele Lechien, supposedly
in honor of a pet pooch.
"A lot of people spent a lot of time chasing Tommy," says Stan
Whitten, a retired SEC official who was among those pursuing Mr.
Quinn.
After Mr. Quinn's November 2009 arrest at John F. Kennedy Airport
following a flight from Ireland, SEC officials moved to require him to
identify and turn over assets to pay the judgment. Mr. Quinn resisted,
citing his Fifth Amendment protection against self-incrimination.
In court papers, his lawyers note that prosecutors said property
supposedly owned by Mr. Quinn, such as a Paris apartment, was used in
the alleged telecommunications scam. When the SEC sought financial
information from several Quinn family members, who an agency court
filing alleges have a "close financial relationship" with him, three
took the Fifth.
The SEC subpoenaed Mr. Quinn's recorded prison phone calls. The calls,
involving relatives and unnamed parties, leave "the distinct
impression that the conversations deal with the sale, movement or
secretion of assets" in violation of a longstanding court-ordered
asset freeze against Mr. Quinn, said an agency court filing.
Some calls, the SEC filing says, appear to be about selling assets,
such as racehorses. In others, the topic seems to be debts owed. "
'The Italian Guy' has got things to settle up with me," said Mr. Quinn
in one excerpted call, adding there should be a "very firm" effort to
collect.
On other calls, the conversation topic seems to be business deals
involving "Bubble Eyes," "The Skier" and "The Bulldog." In one call,
according to the filing, Mr. Quinn said, "If you're desperate, go
through 'The Pony Tail.' You should just give him 2,500 for four
months." In another call, Mr. Quinn is adamant that some unnamed
person shouldn't have anything to do with an unnamed mining company in
Turkey, according to the filing.
The SEC is asking the Dallas federal judge for permission to review
Mr. Quinn's calls to his lawyers, a request being fought by his
attorneys. The agency contends, among other things, that attorney-
client privilege doesn't cover discussions about business deals.
In phone calls that have been reviewed by the SEC, the agency says,
Mr. Quinn refers to business dealings involving his nephew, who also
is listed as one of his attorneys. Given his history as an
"incorrigible" criminal and the content of his nonlawyer calls, the
SEC says, "one can only imagine what took place when Quinn spoke with
his attorneys."
In their court filing, Mr. Quinn's lawyers say the SEC misidentifies
the nephew as part of an "unwarranted attack on the personal and
professional integrity" of the defense team.
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