NEW HAVEN, Conn. -- Martin Frankel, the financier accused of looting insurance companies of more than $200 million and using it to live like an outlaw Hugh Hefner, pleaded guilty Wednesday to pulling off one of the most brazen swindles Wall Street has ever seen.
Frankel, 47, could get up to 150 years in prison and $6.5 million in fines at sentencing next year, though federal prosecutors said they will probably give him a break if he helps recover the missing money.
Defense attorney Jeremiah Donovan admitted the government had a "ton of evidence" against Frankel.
"I sure hope he's a free man one day," Donovan said.
A pale and gaunt Frankel politely answered "yes" or "no" as he was led through the plea bargain by the judge. Originally charged with 36 counts, he admitted to 24 charges of fraud, racketeering, conspiracy and other offenses.
Some money recovered
Prosecutors set the total loss in the fraud at $208 million. To date, the government has recovered $70 million to $80 million, including $30 million Frankel told authorities was hidden in a Swiss bank account.
"The book is not closed in this case," U.S. Attorney John Danaher said afterward. "Those involved in it should not rest, because we won't."
The case went public on May 5, 1999, when firefighters went to Frankel's Greenwich estate and found a blazing file cabinet and two fireplaces stuffed with burning documents.
Among the papers, authorities said, was a to-do list with "launder money" listed at No. 1. Also discovered was an astrological chart intended to answer the question, "Will I go to prison?"
Four months later, after an international manhunt, Frankel was captured at a hotel in Hamburg, Germany, with nine fake passports and 547 diamonds. He was returned to the United States last year.
A short, skinny figure with thick Woody Allen-ish eyeglasses, Frankel began cultivating his image as a brilliant money manager as he worked out of his parents' home in Toledo, Ohio. Authorities said he dropped such names as Lee Iacocca and Walter Cronkite to dupe investors across the country.
Frankel was accused of gaining control of small insurance companies in Arkansas, Mississippi, Missouri, Oklahoma and Tennessee and stealing cash from company reserves. The FBI said he put the money in banks around the world.
He ran the scam from a two-mansion compound in Greenwich that he turned into a warren of offices with more than 80 computers and wide-screen televisions tuned to financial news channels. BMWs and limousines came and went at all hours, and armed bodyguards were posted outside. Floodlights, a 6-foot fence and surveillance cameras made the estate look like a fortress.
Authorities said Frankel spent money on private planes, luxury cars, expensive wines and gifts for women he met through personals ads and other means.
The 6-foot, 135-pound Frankel had a bevy of women living in one of the mansions. Some were former lovers who, once relegated to ex-girlfriend status, stayed on to work at the securities brokerage Frankel ran out of the other mansion.
One woman who was drawn to Frankel through a personal ad, Frances Burge, hanged herself at the compound in 1997 at age 22. Frankel told police he had decided not to have sex with her because she was overweight.
Three others charged in the indictment are awaiting trial: aides Mona Kim and Sonia Howe, and accountant Gary Atnip. Another aide, German national Kaethe Schuchter, is wanted by the FBI.