KEEPING BOOK; 01

I believe the phrase originated on May 12, 1849. Mr. Thomas McDonald was approached on a New York street by a fashionable dressed man who greeted him as if they were old acquaintances. After a few moments’ pleasant conversation the man abruptly asked, “Have you confidence in me, to trust me with your watch until tomorrow?” Without thinking Mr. McDonald handed over his gold watch, valued at $110. However, Mr. McDonald did the see the old friend “tomorrow”. He never saw the stranger or his watch again…until July 7th of 1849, when he spotted the man on a street corner in lower Manhattan and had him arrested. According to the New York Herald the villain was quickly identified as William Thompson, lately of Sing Sing prison, and the paper invited victims of similar thefts to visit his cell at the Tombs to identify the suspect. When they did Mr. Thompson identified himself boastfully as, “I am the Confidence Man.”

As is proven by the pervasiveness of “con men” on Wall Street, success in business is no more a measure of personal intelligence or integrity than the ability to snake a sewer pipe or repair an automobile - as the script for the 1940 film “Citizen Kane” pointed out.

BERNSTEIN: Thatcher! That man was the biggest darn fool I ever met -
THOMPSON: He made an awful lot of money.
BERNSTEIN: It's not a trick to make an awful lot of money…if all you want is to make a lot of money…That kind of fellow you can fool every day in the week - and twice on Sundays!”

And that goes a long way to explain the career of con man Anthony ‘Tino’ De Angelis, the one time so-called “Salad Oil King of Wall Street”. In the words of Roger Lowenstein, Anthony was “…a familiar type in American finance, possessed with a combination of brilliance and moral flexibility that produces a first rate white collar criminal” (“BUFFET” page 80). Of course that aslo describes many first rate captains of American finance, as well.

Time Magazine described "Tino" this way; “His five-foot-four-inch frame was burdened by 240 fleshy pounds, making him seem wider than he was tall. Thin wire-rimmed black spectacles perched precariously on his round face…His rumpled (ready-made) suits usually looked as if he had slept in them…(He) drove around in a large Cadillac and always ostentatiously carried a thick wad of bills.”

Norman C. Miller, for the Saturday Eveniing Post,  tried to explain Anthony’s charm as a con man. “There is something contagious about (his) guileless, open-handed manner….It infected people far outside of his usual social circles. A variety of big businessmen were happy to have a part in Tino’s expansion plans… It pleased him to distribute largess among his retinue of lieutenants and hangers-on, often in the form of cash”. .”(Miller; http://www.mafianj.com/saladoil/tino1.shtml).  In Anthony’s own words, he was “...a man born and raised in the poor section of New York, (who) rises to the point where he runs ten, fifteen businesses or plants around the country.”

While still in his twenties Anthony had “…an exceptional ability in knowing how to process hogs. Some of my methods,” he claimed, “cut the cost of processing hogs enormously.” Anthony opened his own meat packing firm in the midst of the Great Depression and turned a $100,000 profit the very first year. By the end of WWII, like much of the rest of America, Anthony had a pile of capital ready to invest.

He bought controlling interest in Adolf Gobel Company, a deli and sundry wholesaler, and by 1953 he was large enough to be charged by the Federal government with selling them two million pounds of un-inspected meat. Anthony paid the fines and took Gobel into chapter 11, bankruptcy.

Then, in 1955, Anthony borrowed from his two biggest customers, Continental Grain Co. of New York and Bunge Corp. of Buenos Aires, to set up “Allied Crude Vegetable Oil Refining Corporation”, and related companies, which owned warehouses and storage tanks on Constable Hook, New Jersey. The business shipped olive and soybean oil world wide, oil produced from soy beans and olives owned by Continental and Bunge. The investors – slash - customers - charged Allied 15% interest on the loan, but they also took the soy and vegetable oils which Allied had in storage, as collateral, which meant that Anthony didn’t have to risk a dime of his own money to create the company or stock its inventory.

As proof that the oil existed in Allied’s storage tanks Anthony hired American Express. The banking firm had recently started a new division, AMEX Wharehousing, in order to take advantage of the budding market of commodities futures. For a fee AMEX provided receipt's which validated the existence of the oil. Everything depended on that verification. But in 1955, when American Express was charging Allied $20,000 a week to verify the soybean and olive oil in Allied’s tanks, the futures market was not yet regulated. So, when American Express hired “custodians” to verify the product, they hired people such as John Bongardino (the brother-in-law of Anthony's secretary), and Thomas Ckarkin, who was paid $500 a month by American Express as a custodian, but was also paid by Tino $1,600 a month as a “messenger”.

How could Anthony afford to pay his employees such salaries? Because the wizards running American Express had given their customer, Anthony De Angelis, a $3.7 million credit line. And once he had those receipts with that most hallowed of Corporate names in his hand, Anthony was bankable; he had become part of that amoral world of corporate capitalism, where success is the ultimate gauge of moral superiority and can be purchased on margin.

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