A lawyer for Wall Street “bad boy” and wannabe reality-TV star Ross Mandell kicked off his client’s criminal trial yesterday by pinning the blame for investor losses on “four or five rogue brokers.”
Mandell “didn’t know that four or five rogue brokers . . . were cheating their clients,” legal eagle Jeffrey Hoffman told the freshly picked Manhattan federal court jury of six women and six men.
“Half the time he wasn’t even in the US,” Hoffman said, “and if he was in the US, he was sitting in an office far away” from the brokers.
Several of these “rogue” brokers have been arrested by the feds, have pleaded guilty and are expected to take the stand against Mandell, starting with the testimony today of his former pal and business partner Robert Grabowski.
The government alleges that Mandell paid incentives to brokers like Grabowski. These bonus-like payments included prostitutes and trips to strip clubs, when the brokers were successful in promoting shares of two sham companies he founded tied to Sky Capital, Mandell’s New York brokerage firm.
The accused wanted to lure other investors to buy shares of the same companies for a lesser value in private transactions, known as private placements, prosecutors allege. Those proceeds flowed directly into Mandell’s pocket, allowing him to throw money around on “fancy cars and flashy watches,” or to entice his brokers to continue the scheme, prosecutor Pablo Quinones said in opening remarks.
The investors thought they were getting “a real discount,” but instead they lost money, Quinones said.
Mandell — who is on trial with former Sky Capital broker Adam Harrington — has loudly proclaimed his innocence since his July 2009 arrest, even pitching a reality show based on his life while fighting the charges.
In the past the recovering alcoholic has likened himself to “Wall Street” movie icon Gordon Gekko and, more recently, to Mike “The Situation” Sorrentino from “Jersey Shore.”
“If The Situation can do it, so can Ross the Wall Street Situation,” Mandell said in a recent YouTube video while ripping off his shirt.
