Tuesday, 5 May 2015
Last updated 7 hours ago
Mar 25 2013 | 12:25pm ET
Harbinger Capital Management founder Philip Falcone has borrowed an unspecified amount from a Fortress Investment Group unit best known for giving the late Michael Jackson a mortgage on his Neverland Ranch.
Falcone and his wife pledged their $39 million home on the Caribbean island of St. Barthélemy as collateral for the loan, which was revealed in a regulatory filing last month, Bloomberg News reports. Terms of the agreement were not disclosed, by Fortress Credit Corp. which says it specializes in "difficult credits, difficult borrowers and difficult situations," and generally charges extremely high interest rates to borrowers unable to find financing elsewhere.
Falcone—who was still ranked as a billionaire as of the end of last year by Forbes magazine—has the lion's share of his assets invested in Harbinger funds. But his hedge fund has hit upon hard times, suffering huge losses on its largest investment, which filed for bankruptcy last year, while watching nearly 90% of its assets evaporate, cutting into the management fees Falcone collects.
Falcone and his wife, Lisa Maria, bought the seven-bedroom St. Barths villa for more than US$39 million in 2008, the same year the couple bought their 27-room Manhattan mansion for US$49 million.
The Falcones have been dealing with cash issues for several years now. In 2009, Falcone took a controversial $113 million loan from his funds to pay a tax bill. Falcone said he did nothing improper, and needed the loan because his fortune was tied up in Harbinger's funds, but last year he was hit with fraud charged by the Securities and Exchange Commission over it. In 2010, the couple took out a $22.5 million mortgage on the Manhattan townhouse and a loan backed by some of their art collection. Last March, they secured a second lien on the mansion to extend what had been a $15 million line of credit from Citigroup, having drawn the entirety. And in November, they borrowed $10 million from Vision Capital Partners, secured by a second townhouse the own on Manhattan's East 67th Street.
Mar 20 2015 | 12:45pm ET
StreetWise Partners, a non-profit organization that works with low-income individuals to help them overcome employment barriers, raised over $275,000 at the 2015 Raising the Ante Charity Poker Tournament and Casino Event last Wednesday evening at Capitale. Here are some photos from the event. Read more…