Fraud, S&M and St. Francis: A Riotous Bull-Market Fable

The Pretender: How Martin Frankel Fooled the Financial World and Led the Feds on One of the Most Publicized Manhunts in History , by Ellen Joan Pollock. Wall Street Journal Books, 276 pages, $25.

For a few glorious years, nothing stood between Martin Frankel and other people’s money. Sure, he’d been barred for life from the securities business back in ’92–what, that bothers you?–and O.K., he lived with his mom until he was 31, give or take. And O.K., he used an alias (hey, who doesn’t these days?) and subsisted on nothing but canned tuna–right, this part’s a bit strange–and S&M and the zodiac. But Marty Frankel was a genius. It’s all right there, in his disclosure materials, for anyone to see: His method of stock-picking had an “epistemological underpinning akin to astrology or Tarot.” Was this guy a talent, or what?

You get the picture. About six seconds of due diligence or government oversight could have stopped Mr. Frankel dead in his tracks, long before he looted a cool $200 million, before he started the bondage sex cult in Greenwich, before he hoodwinked the Vatican, Lee Iacocca and Democratic Party macher Bob Strauss. But this was the 90’s, it was a bull market, no one had the six seconds to spare. And besides, efficient markets and “creative destruction” sort everything out, right?

The Pretender is Wall Street Journal veteran Ellen Joan Pollock’s strange and absorbing tale of old-fashioned destruction: bilking, fraud and regulatory snoozing. Ms. Pollock’s expertly reported account follows Mr. Frankel from his days as an inept storefront stock-picker in the 80’s to his rise as a kind of one-man Enron in the 90’s. Mr. Frankel bought insurance companies throughout the South, then allegedly plundered them, all while surrounding himself in his ill-gotten Greenwich mansion with a harem of S&M yes-women. When the story first broke a couple of years ago, with Mr. Frankel on the lam in Europe and fresh details of his financial and sexual chicanery leaking out on a daily basis, readers greedily popped open their Times or Journal , scarcely believing each salacious Grand Guignol installment. Ms. Pollock has stitched it all together here, the wondrous fable of Marty Frankel’s life.

Ms. Pollock’s “Marty” is plenty colorful–in fact, he’s nothing short of a splendid bunting of red flags that, in the heyday of the bull, could somehow be construed as evidence of eccentric brilliance. Nobody, it seems, wanted to believe their lying eyes: Marty’s habit of leaving his fly unzipped (he hated to feel “confined,” Ms. Pollock tells us), his increasingly rabid obsessions with the zodiac and St. Francis, his general status as a whiner, a fink and a mama’s boy–nothing turned people off the idea that he was a Buffett-like guru, capable of making them rich.

Although he talked a decent game, droning on about puts and straddles, in the end Martin Frankel is to Warren Buffett what renting Weird Science is to mapping the human genome. Marty couldn’t consummate a trade without paroxysms of anxious self-recrimination. But he could make letterhead like nobody’s business: Onto his Mac he goes, a-hunting and a-pecking, printing out fake résumés, financial statements and astronomical (and altogether bogus) stock returns. As no one else around seems to have heard of “home publishing,” this was enough to leverage Marty out of Toledo, Ohio–out of the universe of ranch houses and Supercuts–and into his Greenwich cul-de-sac, surrounded by Benzes and a P. Diddy-style security detail and, of course, his now-infamous women.

Ah, Marty’s peculiar ménage. He had trawled the personals for years, gathering in women to appease a growing appetite for recreational pain. With his thinning hair, tilted specs and a bit of the deadeye–not serial-killer deadeye, more like grad-student deadeye, that steady lithium gaze–there was “nothing that anyone of any gender would find attractive about Marty Frankel,” as one of his early Toledo gulls put it. Even so, some found it comparatively easy to overlook his terminal pastiness and pipe-cleaner physique: A steady stream of damaged young women were mesmerized by Marty’s back-country digs and limitless access to cash. (A quick count yields maybe seven women here who could be played by Juliette Lewis.) Night after night saw Raise the Red Lantern -style competitions for his bed, with Marty finally settling on Oksana–who, with a jail-bait, undernourished and thoroughly mail-away feel to her, proves too tacky to accompany Marty to his father’s funeral back in Toledo.

All of which would be funny, if it weren’t completely unfunny. To his own growing horror, Marty discovered that Oksana’s aura of pubescence wouldn’t entirely fulfill his desire to violate a child. Picking up on this, and hoping to curry the master’s favor, another woman in the household hired egg and sperm donors and a surrogate, and had a child conceived just for Marty. The baby ended up in the Greenwich mansion, and according to Ms. Pollock, photos of the naked infant draped in pearls adorned the mantle. Marty was “conflicted,” Ms. Pollock tells us, but not enough to keep him from making astrological charts predicting that their sex life together would be “wonderful.”

Where can a story like this go? With Marty’s global ambitions, his Koresh-style personality disorder and his credibility with investors all expanding apace, Mr. Iacocca and Mr. Strauss jumped on board. The atmosphere of gloom and dislocation only thickened, though, and Marty found himself in over his head in a world of shadowy fixers, sub rosa deputies of the C.I.A. and the mob–a world where “consulting fee” and “hush money” slurry together, and the guys reminisce about their “Roy Cohn days.” To create a semblance of credibility, Marty attempted to make the Vatican a holding company for his insurance empire. (In perhaps my favorite episode, Marty dreamed up “The Saint Francis of Assisi Foundation to Serve and Help the Poor and Alleviate Suffering–a British Virgin Islands trust.”) But to no avail. There’s one last demented paramour, a satchel full of diamonds and a Gulfstream purring on the tarmac at Teterboro before the inevitable blizzard of subpoenas. Mr. Frankel is now awaiting trial in a federal prison in Rhode Island.

Ms. Pollock has written a thorough, and thoroughly entertaining, account. In Cold Blood it isn’t; her book has a first-to-market feel to it, tapped out in a staccato journalese, but the research is prodigious. She had a great bull-market story to work with–how a madman and the world, for one funny-money decade, aligned perfectly. With his mooncalf theories and his tooth for kinky leisure, Mr. Frankel was not your average Wall Streeter. Rather, he was what a porn-awards show is to the Oscars: a camp facsimile that gets at something true about the original.

Stephen Metcalf writes for Slate , The New Republic and The Nation.

Fraud, S&M and St. Francis: A Riotous Bull-Market Fable