LIST
How the Rich Got Poorer
The 10 worst investments in recent
history BY JASON DALEY
CASHED OUT
“Show me the
money pit!”
9 I Sylvester Stallone’s
Hedge Fund
Sly thought he had made a killing when
he cashed out $1.3 million in earnings
from the Lipper Convertibles hedge fund.
But then it was revealed that the fund’s
managers had made up the 40 percent
returns and the fund collapsed. Those
who got burned sued Stallone and
everyone else who cashed out before the
fraud was revealed. So far, the lawsuit,
which calls for early withdrawers to give
back some of what they’d earned, hasn’t
been settled. That’s fine with Stallone.
He needs the cash to keep his first bad
investment—the Planet Holly wood
restaurant chain—on life support.
8 I Mick Fleetwood’s Nose
The former Fleetwood Mac drummer
estimates that he has snorted more than
$8 million of blow. (Is that all?) We’re
not passing judgment on how he fueled
his creative juices, but the nose candy
also powered a real-estate shopping
spree that sounds like the lyrics of a
Beach Boys tune: Bel Air, Malibu, Hawaii,
Sydney. “I was finding a way to create…a
safe harbor from what was a very crazy
world…,” Fleetwood told The New York
Times. Then came bankruptcy court.
7 I Kevin Bacon’s
Madoff Connection
It goes without saying that Bernie
Madoff duped a lot of celebrities. Pedro
Almodóvar lost around $280,000. Jeffrey
Katzenberg let go of $20 million. But
it appears no one was more heavily
invested than Kevin Bacon and his wife,
Kyra Sedgwick…so much so that they
were allegedly forced into six degrees of
separation from all but their real estate
and checking accounts.
10 RANDY QUAID’S PHALLUS
If you’re going to drop $3.5 million into your
wife’s directorial debut, you should probably
talk her out of naming the film The Debtors.
But a debtor is exactly what the funnyman
became when a dispute erupted over a scene
involving a giant phallus, a German rock
band, and a few gallons of milk, delaying the
release of the art-house dud for three years
and landing the actor in bankruptcy court. As
if the whole debacle weren’t embarrassing
enough, Quaid had to put up with his wife
aggressively promoting the movie with an
exhibit featuring giant photos of her vagina.
Not all sex, it turns out, sells.
6 I Slash’s Hollywood Crib
When Saul Hudson (a.k.a. Slash), the
top-hat-clad ax man for Guns N’ Roses,
bought a 7,800-square-foot crib in the
Holly wood Hills, he thought he’d found
his “dream home,” as he later stated in a
lawsuit. But then he found out the house
was slightly smaller than advertised and
had “title defects.” Slash sued Sotheby’s
(his real-estate broker), saying the house
caused him “grief, shame, humiliation,
anger, worry, nervousness, stomach
disorders, backaches, loss of appetite [for
destruction?], and inability to concentrate
on work.” Then someone reminded him
that, no, it was his heroin addiction that
had caused all those problems.
5 I Bruce Willis’s Spare Tires
His heart was in the right place, but
the Die Hard star should have done a
little more research before he invested
$2 million with a Malaysian prince
named Tunku Imran Tuanku Ja’afar, who
promised a new waste-free method of
recycling used tires into fresh rubber.
When the company’s big IPO never
panned out, Willis tried to reclaim his
cash, to no avail. He eventually strong-armed $1.1 million from the company, and
a lawsuit helped him get back the other
$900,000, though Willis didn’t receive
interest on the money as requested.
If Willis is looking for new investment
opportunities, there’s a Nigerian king who
just sent us an e-mail.
4 I Harry Frazee’s
Boston Curse
At the turn of the century, Boston theater
impresario and owner of the Red Sox
Harry Frazee found himself short on
cash and eager to back a Broadway play
called My Lady Friends. So what did he
do? Take out a loan? Sell off his least
valuable players? Those would have been
the sensible moves. Instead, he sold off
his star player and home-run king (that
would be Babe Ruth) to the New York
Yankees for $100,000. Little did Frazee
know that, decades later, this decision
would cause millions of self-absorbed
young white men to don Boston Red Sox
caps, thinking this would make them look
slightly edgy and outside the mainstream.
3 I Just For Feet’s
Super Bowl Strategy
When this Alabama-based sneaker
chain was plotting to become the next
Foot Locker, it pumped $7 million into
a glitzy Super Bowl ad to launch the
brand nationally. The spot, put together
by advertising firm Saatchi and Saatchi,
depicted a posse of white hunters in a
Humvee, chasing down and drugging a
barefoot Kenyan runner before slipping a
pair of Nikes onto his feet. Just For Feet
was quickly dubbed “Just For Racists.”
2 I Prince Abdulla of
Bahrain’s Jacko Obsession
There’s a bit more to the story of Michael
Jackson’s self-imposed exile to Bahrain
following his molestation acquittal.
The king of pop actually shacked up
with überfan Prince Abdulla of Bahrain,
and the deal came with lots of strings
attached. In exchange for housing the
financially troubled pop star, building
him a custom studio, and giving him a
$7 million advance, Abdulla demanded
that he be the coproducer and cowriter
of two albums and—wait for it—a stage
show. But six months after taking up
residence, Jacko split without laying
down a single track. Abdulla sued, and
the two settled out of court last year.
The terms haven’t been disclosed, but
Bubbles the Chimp, Jackson’s longtime
animal companion, was recently spotted
racing camels outside Abu Dhabi.
And the winner is…
1 I Henry T. Nicholas’s
Sex Dungeon
The easiest way to advertise your
multimillion-dollar secret sex dungeon?
Refuse to pay the contractor. That’s what
happened to Nicholas, the billionaire co-
founder of Broadcom, who hired several
contractors to build a $30 million sex
den beneath his mansion in Laguna Hills,
California, while he and his wife were
vacationing in Hawaii. Plans for the lair—
which supposedly included a sports bar
where Nicholas could bring hookers and
indulge in the leisure pursuits of ecstasy
and cocaine—were revealed when one
contractor sued Nicholas for not paying
up. Nicholas insists that the guy is lying,
and he was building an underground
pump house. Call it what you will….
