Kenneth Starr's (Not That One!) $30 Million Ponzi Scheme

Hollywood gets the Madoff treatment

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When news broke about Kenneth Starr's alleged $30 million Ponzi scheme, nearly everyone in the media rushed to dispel the confusion--no, not THAT Kenneth Starr. The Kenneth Starr implicated in the elaborate scheme bilking famous celebrities, athletes and political elites is a notable financial adviser--not the investigator of Whitewater fame. Regardless, Starr allegedly gathered funds from wealthy clients--including Martin Scorsese, Uma Thurman, Henry Kissinger and Ron Howard--and used that money to pay off other clients while skimming some off the top. Here's what bloggers are focusing on:

  • He Was Done In By His Wife, observes Vanity Fair's Julian Sancton: "When the feds knocked on the door of accused Ponzi schemer Kenneth Starr's Manhattan triplex, his ex-stripper wife told them her husband wasn't home before pointing upwards and whispering, 'He's upstairs.' Authorities found Starr cowering in his closet when they saw his shoes sticking out from behind a rackfull of coats."
  • A Classic Ponzi Scheme, writes Dan Indiviglio at The Atlantic: "This sounds like pretty prototypical Ponzi scheme maneuvering. Take money from one client, channel it to another when necessary, and keep some for yourself. The DOJ complaint has similar sorts of allegations in even greater detail. It explains the tax scheme accusation, which involves former President of the New York City Council Andrew Stein, who Starr advised."
  • Starr Did It All to Please His Woman, writes Peter Lauria at The Daily Beast: "Desperate to help his girlfriend, Diane Passage, break into the music business, alleged Ponzi-schemer Kenneth Starr brought her to a 2007 party at Denise Rich's multimillion-dollar New York penthouse, overlooking Central Park... Many of the items bought by Starr and detailed in the indictment--including a $70,000 diamond bracelet, $16,000 ladies' round brilliant cut diamond chandelier earrings, and $32,000 ladies' two-row diamond wedding band--have the distinct whiff of overcompensation."
  • Charges Filed Against Former President of the NY City Council As Well, reports Fox Business News:

  • What Have We Learned? U.S. Attorney Preet Bharara says everyone's vulnerable to financial fraud: "Today's charges against Kenneth Starr seem to confirm what has become all too apparent lately -- anyone can be a victim of financial fraud. Whether you are an ordinary citizen or a savvy businessman or a sophisticated celebrity, you can be victimized."
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