Born to Steal: When the Mafia Hit Wall Street (16 page)

Frank Junior and Michael had both moved to Chic-Chick after they left their last line of work back in 1991. According to papers
later filed by Chic-Chick with the New York secretary of state, Frank Junior had “owned and operated transit companies having
bus contracts with the New York City Board of Education,” and the same description applied to his older brother Michael, except
for the ownership part.

It was not exactly a typical career transition—school buses to fried chicken—but there were commonalities. School-age children
ride in school buses and eat fried chicken, no? Besides, management is management, and the Coppa name alone stood for something,
particularly when stock was involved.

Frank wanted to take the company public, À la Boston Chicken, with Frank Junior slated to be the chairman and chief executive
officer. The first thing he was going to do was to commence a “private placement” of Chic-Chick shares. That is a conventional
and, usually, perfectly respectable capital-raising technique, used by thousands of companies. A private placement is a bit
like an IPO, but without all the dumb SEC paperwork. In a private placement, wealthy investors—they have to be millionaires,
by law—invest money in a company that is not yet public, often in the expectation that it will go public sometime down the
road.

When a private placement works out okay, the investors can walk away very wealthy. If it goes wrong, they can lose every penny.
The business can go bad, or—it happens—maybe the company doesn’t exist at all. But that wasn’t happening here. There were
Chic-Chick restaurants. Six of them. None were owned by the company—all were owned and operated by outsiders, under franchise.
But that was fine print and who gave a fuck about that?

For Frank Senior, the private placement was a way of killing two pullets with one stone. He would raise money for the company
and, meanwhile, lay the groundwork for taking the company public. That way everybody would make a bundle of money. Legally.
Frank was enthusiastic—and hey, when Frank wanted something, he usually got it. Whether it was a private placement or Benny’s
’Vette.

The ’Vette episode did not rankle Benny.

Guys always retain ties to their neighborhoods, and Frank Coppa was no exception. He lived in New Jersey but, like a salesman
who knew the territory, he still had an exclusive franchise over the vicinity of 86th Street at the eastern edge of Bensonhurst
by the elevated train line. As soon as you walked onto the platform you were in Frank Coppa Country. It could have been on
the subway maps, for it was just as true as “86th Street.”

Frank’s territory encompassed a low-income municipal housing project called Marlboro Houses. By Benny’s account, the whole
’Vette business stemmed from the fact that Benny, who lived in the vicinity, used to sell drugs at Marlboro back in the 1980s
and early 1990s, at the time when he was listed on NASD records as “unemployed.”

Frank was no neighborhood dope dealer, but Benny’s enterprise fell under his jurisdiction, so Benny had to pay him for the
privilege, and he couldn’t come up with the cash one time. Frank got his ’Vette. He climbed into the ’Vette, somehow, and
drove off with it.

Benny’s drug dealing put him in contact with more than just the honest, hardworking substance abusers of Marlboro Houses.
He got to know a guy in his mid-twenties, from Queens originally, who had slicked-back blond hair and looked a bit like Charlie
Sheen. Al Palagonia was just starting to make his name at D. H. Blair when he met Benny. And when Hanover Sterling started
up in 1992, Al introduced Benny to his other friend, Roy Ageloff. Benny was genial and smart, a hustler. Just the kind of
fresh new blood Roy was looking for, a young kid uncontaminated by the Street.

In the years ahead, people on the outside, regulators and journalists, would have described Frank’s visit to Brod as part
of some kind of effort to “infiltrate” Brod. But the Frank-Benny-Brod relationship was a lot simpler than that. Frank was
just bringing a business deal to an associate. And it was one hell of a deal.

It took a few months for the papers to be processed. Louis was not waiting with bated breath. Which was good. Because when
Louis saw the Chic-Chick private placement memorandum, duly filed with the New York State Bureau of Investor Protection in
February 1995, he almost gagged.

Louis was being asked to sell Chic-Chick “units” to his clients, and each of them cost $25,000. The units were in the form
of a loan, at 10 percent, with some stock thrown in as a sweetener. But there was no way you could sugarcoat Chic-Chick. In
1994 the company had a financial statement that looked as if it was generated by a small-town church thrift shop—revenues
of $163,581 and expenses of $158,568, with $59,736 in working capital. That was it. No 000s omitted.

True, Chic-Chick had “expansion” plans. Following this offering, the private placement memorandum said, “the Company intends
to commence development of one (minimum) or two (maximum) Company owned restaurants.” If the “casual atmosphere” didn’t get
them lining up outside the “one (minimum) or two (maximum)” Chic-Chick-owned and -operated restaurants, they might be enticed
by the slogan, “Chicken with Good Taste.”

“I used to say to Benny I had a pitch for Chic-Chick: ‘Frank used to eat a lot of chicken when he was young, used to cook
the chicken on the barbecue. And he told his son, “You should start a franchise chicken company.”’ I used to say they could
put Frank in a chicken suit in front of the store, and that wouldn’t sell the chicken. It wasn’t even good chicken. The fries
were rubbery. It was the stupidest fucking thing I ever saw in my life. They had the whole family working there. Frank Junior
was really into it. I think that Frank Junior really wanted to make it go somewhere, but his father probably smacked him.
‘Smarten up!’

“I used to pitch it by saying, ‘Listen, I got something coming up. Chic-Chick. They got one franchise store and they’re opening
up nine more. Could be the next Kentucky Fried Chicken.’ I felt like saying, ‘Frank Coppa owns it. You know, the guy in the
Mafia. They got his name right in the prospectus.’ What else could you say about this company? It was fucking horrible. I
couldn’t sell it. These guys are putting on the pressure and I told Benny, ‘Tell them I can’t do it. I can sell a lady in
white gloves an open jar of ketchup but I can’t sell Chic-Chick.’ Eventually I got about three hundred thousand dollars of
it sold, I don’t know how.”

By now, New York State law prohibited smoking in most places of employment. Louis could always tell when Frank was arriving
at Brod because he tended to disregard that particular statutory restriction. Frank was always smoking big cigars—“torpedoes”—and
he didn’t care much if anybody was gagging on the fumes. Louis observed that he always dressed well. Guys like him always
wore stylish clothing, but a Guy like Frank was not a slave to conventions in men’s clothing. Guys were fashion leaders, at
least in their own circles.

“He always wore slacks, never jeans. Always grayish slacks, nice shoes. A button-down shirt. No tie. And a black, short mink
coat. I mean, he wears a fur, mink jacket. Men don’t wear mink jackets. Like how do you walk down Wall Street in a mink jacket
and people not think that you’re a gangster? He probably had it custom-made. You have to go to Fifth Avenue, to one of the
fur stores there. These are the guys who wear a mink coat: Either John Gotti, or a black guy. Some pimp in Harlem.

“Frank wore a Rolex, but with style. Not gaudy. Not with diamonds. Not like mine. Mine had diamonds around the top, diamonds
all over it. He just wore a gold Rolex, no diamonds, a bracelet, and a ring. Ring had a sick diamond on it. Then he had the
cigar. It was about a foot long, I’m not kidding. But for him it was small. He was tremendous. All fat, but you don’t tell
him that. Like he ain’t even a nice guy. Call him fat and he’d probably smack you around. He had big hands. Big Italian hands.
Definitely a mean guy in his prime. You could tell.”

Chic-Chick was an annoyance. But he had to pitch Chic-Chick. Benny made that clear. There was no choice. But Louis didn’t
care. He was building a business. And sometimes, when you build a business, you have to do people favors. That’s how Wall
Street works. Favors. Networking. Louis was learning that—learning to become a Wall Street guy.

The chop house kids loved Howard Stern. His early morning radio show was as much a part of their lives as the pitches they
read and the rips that were making them rich. The media called him a “shock jock,” but that was the media for you—full of
crap, as always. The press, and the yahoos and scrubs who tried to get him off the air, saw only the sensational stuff, the
strippers, the butt bongo. To the chop house kids, Howard was just a guy from a blue-collar suburb who made good, who spoke
his mind. He was a cool older guy. A Roy. Like Roy, Howard dressed as he wanted, didn’t go in for the button-down life, told
people in authority to go fuck themselves, didn’t let the government cut off his balls. He had an entourage, just like Roy.
He yelled at his people and gave them a hard time, just like Roy—and they still loved him. Just like Roy.

But it was the fight with the Federal Communications Commission, his constant running battle with the government, which was
the most important common ground. Howard fought the FCC and won. The chop house kids were fighting the SEC and winning. And
through it all—this was the part his detractors missed—Howard was always a family man. A private man, who lived on Long Island
with his family and didn’t cheat on his wife.

Louis wanted desperately to get Howard Stern as a client. It would be like getting God as a client. No, better than God, because
there was no God. And there was a Howard Stern.

Louis began his campaign methodically. He decided to home in on the periphery, the entourage of on-air personalities who kept
Howard fed with straight lines. One of the most popular was a former intern named John Melendez, “Stuttering John,” who was
noted for buttonholing celebrities at premieres and asking rude questions. Stuttering John was a young guy, only a bit older
than Louis, and he was too young to have his own entourage.

It was Louis’s idea to call Stuttering John, and he did it only a few weeks after he started working at Brod. John had talked
on the air about how he was buying into IPOs, and Howard was goofing on him about it.

“Benny said, ‘Yeah give him a call.’ Benny would never do it because he has no balls. So I did it. I didn’t give a shit. What
was he going to say? Get off the phone, fuck you, hang up on me? That would be it. Dead issue.

“So I just called John out of the blue. I called the Howard Stern office and asked for John—‘John Melendez, please.’ He answered
his own phone. I says, ‘This is Ben Salmonese.’ The first conversation was under Ben’s name, because it was his license—if
he looked into me, he’d have found I wasn’t licensed. I used Benny’s name, and made him some money. We sold him HOOP [Sure
Shot] warrants. I told him, ‘Listen, I’ll buy you twenty thousand warrants. I’ll buy them today, sell them in two days. If
I don’t do that, don’t pay for them.’ I was guaranteeing the money. So he said, ‘Sure. Fuck it.’ He didn’t care.”

Louis was selling a lot of warrants at Brod. He loved warrants. A warrant is a wager on the future price of a stock, and works
about the same as a stock option. It gives you the right to get a stock at a certain price sometime in the future. Warrants
can be a good investment if you think the underlying stock is going to really grow in value. If you spend a buck to buy a
warrant that lets you get a hundred shares of a stock at $5 next year, and you think the stock is going to go up to $10 by
then, that’s pretty good, no?

But Louis never told his customers that. He said warrants were “trading vehicles.” They were pieces of paper that, Louis insisted,
were going to increase in price. What they represented, what you could do with the warrant—he didn’t get into that. He simply
said warrants were a sure thing. Something you buy at $1 and sell later at $2. Guaranteed.

What Louis told Stuttering John was pretty much the same pitch that Louis was giving a lot of clients—that the Sure Shot warrants
were the next best thing to printing money. Louis was always amazed how it would work. They believed him! Sure Shot warrants
were all pretty much controlled—“boxed”—by Louis and Benny and a few other Brod brokers, so Louis knew perfectly well who
was going to make money and who wasn’t.

Louis wasn’t trying to rip off Stuttering John. He really wanted John to make money. He saw to that. He wanted Stuttering
John to be happy. He wanted John, the other Howard Stern people—and then Howard himself. The Holy butt-bongo-banging, stripper-ogling
Grail.

“So we opened his account, and bought the warrants for John for about a dollar forty, and sold it for him for something like
three dollars in like two days. We made him thirty-five grand, something like that. I think he had only twenty grand he wanted
to spend, so he wound up buying maybe sixteen thousand warrants. He was happy as anything. I called him back, and said, ‘You
got that sell confirmation?’ He says, ‘Yeah.’ So I said, ‘You can call up Kemper
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and find out the balance in your account.’ I’m sure he did, and found out he had like forty-something thousand in there.
Then he sent the money. ”

Sure, Louis wanted referrals. But it was more than that. John was the real thing—a celebrity. Okay, a low-rent celebrity,
not too well known outside the New York area or the Howard Stern orbit. But Howard was the King of All Media, and Stuttering
John was an important part of the show. He had a band and was selling CDs. A great client. Any legit broker on the Real Wall
Street could have told you that. And how many of them could have guaranteed him profits?

They had to meet.

“After he sends the check I call him and say maybe we should meet up. So I says Scores, ’cause we had a lot of pull there,
not that he didn’t. We met him at Scores. He was with a couple of his guys who worked at the station. When we shook his hand
he kind of laughed. He was expecting a totally different situation. I was twenty years old, Benny had a leather motorcycle
jacket on, a Michael Jackson jacket. We didn’t really talk about business. We just told him we wanted referrals, and he was,
like, laughing, and people were coming over to him and he was goofing on them. He was a goofball. He goofs on people.