Short of Cash, Arts Patron Remains in Jail
Wednesday, June 1, 2005
NEW YORK -- Alberto W. Vilar is accustomed to life in an 11,000-square-foot apartment in one of Manhattan's best addresses. But for the next few days, his quarters will be a lot smaller.
Vilar, a 64-year-old who promised grand donations to the Kennedy Center and the Washington Opera among other art organizations, stands accused of a multimillion-dollar fraud. His attorneys asked a federal judge Tuesday to delay a bail hearing that might have sprung their client from jail. That hearing has been rescheduled for Friday. Until then, a man once reputed to be among the country's richest men -- in 2004 his personal fortune was pegged at $950 million by Forbes magazine -- will reside in the Metropolitan Correction Center in Manhattan.
Vilar landed there Friday, not long after federal agents who allege that he bilked a client of $5 million arrested him at the Newark Liberty International Airport. For years, Vilar led a highly successful investment firm that bet heavily on technology stocks, attracting billions in assets and earning him a fortune during the run-up in shares of companies such as Cisco and Microsoft.
With that money, Vilar became a high-profile patron of the arts, pledging some $225 million to symphonies and opera houses, including Carnegie Hall and the Metropolitan Opera as well as the Washington institutions. It's unclear how much he actually delivered.
After the tech bubble evaporated, Vilar suddenly seemed strapped for cash. In 2003, the Washington Opera acknowledged that $2 million in donations that were credited to Vilar actually came from opera star and Washington Opera director Placido Domingo. ("I try to keep my giving a secret out of consideration for a friend," Domingo told The Washington Post at the time.) Around the same time, the Met removed Vilar's name, which had been chiseled in gold, from a plaque hailing the "Alberto Vilar Grand Tier of the Metropolitan Opera House."
The Kennedy Center said Tuesday that in 2001, Vilar promised $50 million over a 10-year period. Arts organizations are reluctant to detail the shortcomings of their contributors, but one source at the center said Tuesday Vilar actually handed over less than 10 percent of that amount in a single initial payment and that he failed to make additional payments even after a new donation schedule was negotiated. The Kennedy Center apparently is not counting on ever seeing the rest.
"We are greatly disturbed by the news of Alberto Vilar, who has been a donor to the Kennedy Center," said spokeswoman Tiki Davies. "The Kennedy Center budget does not incorporate further contributions from Mr. Vilar."
The U.S. Attorney's Office in Manhattan has charged Vilar with defrauding an investor who put $5 million into Amerindo Investment Advisors Inc, the firm Vilar headed. Vilar had promised to invest the money in a government-backed investment company, but instead he used it as "a personal piggy bank," as it says in the government's complaint, spending it to maintain his apartment in United Nations Plaza. Some $650,000 went to Vilar's business expenses; about $14,000 was spent on catering. Some money also was spent to follow through on his promises to arts charities.
The three fraud-related counts that Vilar is charged with might be "just the tip of the iceberg," said David Esseks, an assistant U.S. attorney, at a hearing on Friday.
Vilar's attorneys say that their client is innocent and that the complaint is based on the allegations of a disgruntled investor.
"He is confident that he will be exonerated of the charges," said Frederick P. Hafetz of the law firm Hafetz & Necheles. Hafetz said that he and his partner requested a delay in the bail hearing to put together an alternative offer to the $10 million demanded by the magistrate when Vilar was arrested. The attorney for Vilar at the hearing on Friday said Vilar has less than $10,000 in the bank.
If true, Vilar has fallen from the ranks of varsity philanthropist in record time. A Cuban refugee who arrived in the United States in 1959, Vilar rose to prominence as the stock market soared in the '90s. At his peak, some $8 billion in assets were under his firm's control. He lived fabulously well, but he became famous for what he gave away rather than what he spent on himself.
A self-described opera fanatic -- he once claimed to have attended 100 performances in a year -- Vilar might have had his love for music in mind when he promised to write those massive checks. But in one instance, he actually sought out the spotlight in the most literal way. A former Met chairwoman told the New York Times that Vilar once suggested mega-donors such as himself get a chance to take a bow onstage. The Met declined.