Sad report in the WSJ about Mario Gabelli and his support of "small businesses" (aka friends) who profited from FCC license sales. If true, it's another very sad story of someone who has it all...pushing for even more. Pigs get fed. Hogs get slaughtered. Will people never learn?
EXCERPTS: In all, Gabelli-backed companies won 96 licenses in eight auctions. Defending against the suit's allegation that some were sham bidders, the Gabelli legal team said in court papers that FCC rules were "complex, ambiguous and continually evolving" and that the FCC reviewed and approved each application. Gabelli lawyers have sued the FCC seeking internal documents to bolster the point. Some bidders Mr. Gabelli or affiliates of his backed didn't have control over their own bank accounts, and some principals didn't even have authority to write checks, court papers show. One bidder in the sale of radio spectrum told the court she didn't know what spectrum was. Another, Mr. Tucker, testified that he thought he was a "passive investor" in a bidding entity, even though he was listed in its application to the FCC as a director and an owner. Ms. Cadorin, listed as president of a bidding company, testified that she wasn't aware whether that company had a budget, employees or customers. "It was always my hope that at one point I would be more involved," she said. Ms. Kane, the former aerobics instructor, certified to the FCC that she had full control, "acting alone, to manage the business and affairs" of Aer Force, the partnership that bid at the auction. She used her home address and phone number as its address. Ms. Kane's husband, Theodore Kane, who like Mr. Gabelli is a money manager in Rye, N.Y., also was an investor in the bidding company. http://www.post-gazette.com/pg/05361/628545.stm :eek:
this story stinks to high heaven. where is spitzer on this one? Sky King Firms related to Mario Gabelli backed bidders at FCC auctions of cellphone spectrum and profited when that spectrum was later sold. Here is how one deal worked: Firms affiliated with Mr. Gabelli help set up Beta Communications, owned 50.1 percent by accountant Alfred Angelo and 49.9 percent by Mr. Gabelli s affiliates. Beta wins three auctions in April 1999 with bids totaling $17.2 million. Small-business discount means that Beta has to pay just $12.9 million. Beta provides no cell service, sells licenses a year later for $98 million. Beta pays Gabelli-affiliated companies fees that allow them to end up with about 75 percent of sale proceeds
Now, imagine how Gabelli's "friends" feel after he allegedly set them up in "business" to win these licenses, and they're facing federal investigations for fraud, or worse. Reportedly his controlled companies walk with 75% of possibly fraudulent profits, and his buddies get left to face the feds. For some years I ran a communications company. I was in contact with his advertising director about producing some ads for the company. "Whatever you do", she told me, "Just make sure that Mario's picture is big. He likes that." Enough said.