There are many ingredients to a Ponzi scheme—gall, unscrupulousness, hard salesmanship—but only one is in every recipe: other people’s money. That is as true of the two ticket-scalping Ponzi schemes to emerge in New York this year as it was of Bernie Madoff’s masterpiece.
The alleged—and allegedly linked—Hamilton and Craig Carton scams have another thing in common with Madoff’s $65 billion fraud. For while they sound like the kind of low-rent, hare-brained grift that normally ensnares trusting relatives and the elderly, the supposed ticket-tout masterminds were actually fishing in much richer ponds. Paul Tudor Jones, Michael Dell and other hedge-fund bigwigs are said to be among the victims of the Hamilton fraud, while in spite (because?) of his extraordinarily obnoxious personality, Carton could rely on the trust and financial backing of Absolute Return’s Management Firm of the Year.
The hedge fund allegedly defrauded of $4.6 million by WFAN morning-show host Craig Carton and a co-conspirator is New York-based Brigade Capital Management, SI has learned….
Last December, according to the complaints, Brigade agreed to wire $2 million to an unnamed sports and entertainment venue company as a payment for future tickets, even though the company had never been contacted to confirm its supposed business relationship with Carton. Allegedly, Carton falsely told Brigade that the fund’s employees wouldn’t be able to speak with the venue company before making the deposit because its executives were tied up in meetings. Carton then called the unnamed company and told them to expect an errant $2 million wire from Brigade which would need to be rerouted to Tier One Tickets, a company he owned. The venue company sent the money to Carton, and all told none of it was used to purchase tickets.
That is some impressive gullibility on the part of an $18 billion hedge fund that is (we have to say it: allegedly) so well-run.
WFAN Host Craig Carton Allegedly Defrauded New York-Based Brigade Capital Management [Sports Illustrated]