Sol Frank Steinhardt and Michael Steinhardt’s Historic Business Relationships
Much of the money that Steinhardt used when he first began his speculation activity on Wall Street during the early 1960s was money that his father, Sol Frank Steinhardt, apparently gave him. As Michael Steinhardt recalled in No Bull:
“…My father began loaning me money to start investing. Before long, I had a stock portfolio worth $200,000, a substantial sum of money for a 20-year-old in the early 1960s…He would give me, say, $10,000, all in $100 bills (in early 1960s-valued money)…I never asked where the money came from. I simply took the money…to begin investing for him. Occasionally, he would come up with more than $10,000. Once, he handed me a substantially larger amount, which I stuffed in my pockets….It heightened my consciousness to be carrying stacks and stacks of $100 bills through the streets and subways of the city…Investing my father’s money allowed me to invest in the stock market without feeling undue pressure…”
Coincidentally, only a few years before the father of NYU Trustee Steinhardt, Sol Frank Steinhardt, began handing his son a lot of cash in envelopes to “invest,” Sol Frank Steinhardt apparently was accused of enriching himself illegally by then-Manhattan District Attorney Frank Hogan’s office. As Michael Steinhardt noted in No Bull:
“…My father became a gambler of some repute as an adult. His friends and his business activities, along with his gambling, drew the attention of various state and federal authorities…He paid for everything with cash…He did not keep business records nor seriously prepare a tax return until the federal government finally discovered this oversight…He knew Meyer Lansky, the…mobster, and right up until the time of my father’s death, he remained close to Lansky’s partner, Jimmy Aiello--`Jimmy Blue Eyes,’ as his friends called him. I met Jimmy on several occasions; he and my father saw each other at least a couple of times a year…Plenty of rather shady characters were in my father’s circles. When Joey Anastasia, another acquaintance, was shot in the barbershop of the Park Sheraton Hotel, the police picked up my father for questioning. The two of them had apparently been out gambling together the night before Anastasia was killed…
“My father’s gold-buying during the war [World War II] became the defining opportunity of his life and led him into the jewelry business. He became a fixture on Forty-Seventh Street, in the `Diamond District’ of Manhattan, where cash was often the primary medium of exchange…Everybody in the jewelry district knew him…I even heard him referred to as the `jeweler to the mob.’…During my time at Penn, my father was arrested…In 1958, Frank Hogan, the District Attorney of Manhattan, arrested my father and announced publicly that he had apprehended the biggest jewel fence in America, Sol Frank Steinhardt…My father was found guilty on two felony counts and sentenced to prison. For each count, he received 5 to 10 years, to be served consecutively, not concurrently…I hired a lawyer who taught at Brooklyn Law School. He won a second appeal for my father…The court agreed to release my father on the basis of time served (almost 2 years), if my father accepted the felony charge. He did.
“At the time, I believed, totally, in my father’s innocence…Over time, I have come to have a different opinion…He had certainly engaged in purchasing stolen jewelry at various times in his life…He did engage in illegal activities…”
(end of part 3)