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The latest news on Billionaires from Business Insider

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    red china dragon

    The saga of Liu Han—a Sichuan mining billionaire who has gone missing, leaving a trail of uncompleted global financing deals in his wake—illustrates the extreme risks of doing business with Chinese tycoons who may suddenly find themselves out of favor with Beijing.

    International commodities companies who had partnered with Liu are scrambling to find out what on earth has happened to him, amid reports by state-owned media that he was detained for protecting his brother from a murder investigation.

    In the US, people fret over whether billionaires have too much power (pdf) over politicians. In China, the opposite is true. The government officially owns all land, and the country lacks any real rule of law, or independent courts for people to appeal to if a politician treats them unfairly. So business people are entirely dependent on political patronage to stay successful.

    Liu’s company Sichuan Hanlong Group was in talks—now suspended—to lend $665 million to Colorado-based molybdenum miner General Moly. Hanlong has also missed a deadline to complete a $1.19 billion takeover of Australia’s Sundance Resources.

    Coming so soon after China’s new president Xi Jinping was installed, analysts are saying Liu may have found himself on the wrong side of China’s new leaders. The influential Chinese business magazine Caijing reported, citing unnamed sources, that Liu may have helped wealthy Chinese to move money out of the country before the leadership transition. It’s also possible China’s new leaders may have wanted a big business scalp to prove to they are not beyond bringing tycoons to heel. Since last fall, the nation’s 1% have been dressing down and serving cheaper wine to dodge the spotlight. Alternatively, it may be that Liu simply ran afoul of a government official for reasons we’ll never know, or that he really is the subject of an entirely straightforward criminal investigation that has nothing to do with politics.

    Liu’s fall from grace is nothing new. Tycoons have suffered similar downfalls for years: It is jokingly called the “curse of the rich list.” Forbes magazine noted this in 2009.

    Why does this happen? While there is no proof Liu Han has done anything wrong, one theory is that many Chinese billionaires achieved their wealth via corruption. The Communist Party cannot prosecute all of them, but to show the public it has graft under control, every so often it claims a high profile scalp. Another potential billionaire pitfall: The loss of a political patron to Beijing’s cutthroat internal power struggles. Xu Ming, a real estate billionaire linked to fallen former Communist Party star Bo Xilai, was detained last April and has not been seen since.

    The curse has actually been quantified. One study found that 17% of people who appeared on the Shanghai-based Hurun Report’s Chinese rich list were arrested, charged or investigated after being included, in part because the government monitors them more closely, compared with a  7% chance of such entanglements for those not on the list. Liu looks highly likely to be the latest victim.

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    Sheldon Adelson

    Opening arguments in a $328 million lawsuit against Las Vegas Sands casino mogul Sheldon Adelson begin in Las Vegas today, says Bloomberg.

    At question is how Adelson built his multi-billion dollar empire in Asia, specifically in gambling hot spot, Macau.

    This trial really goes back to 2008 when Richard Suen, a Hong Kong businessman, alleged that Las Vegas Sands agreed to pay him and his associates $5 million and 2 percent of the net income from the company’s Macau casinos if they persuaded the Macau Special Administrative Region to award the company a license to operate in the former Portuguese colony in 2002.

    At the end of the 2008 trial, a Las Vegas jury awarded Suen $43.8 million but that decision was overturned by an appeals Court because the judge had allowed "so- called hearsay evidence" to be considered during the trial.

    Now Suen is seeking $98 million in past damages and $230 million in future damages based on Las Vegas Sands’s profit from its Macau casino resorts, Bloomberg reports.

    Suen isn't the only one suing Adelson for alleged bribery, though. Asian American Entertainment Corp. is also suing Las Vegas Sands over its dealings in Macau to the tune of $376 million.

    Former Sands China CEO Steven Jacobs is also suing the company, alleging that he was fired when he would not engage in inappropriate conduct and use "improper leverage" against Chinese officials.

    Las month, in Las Vegas Sands' latest regulatory report to the SEC, the company admitted that it may have violated anti-bribery laws.Specifically, the filing said that “there were likely violations of the books and records and internal controls provisions.”

    Now here's the thing: $376 million is a drop in the bucket to Adelson, who threw $20 million of his own personal wealth at the 2012 U.S. Presidential election without even batting an eye. Bloomberg estimates that he's the 17th richest person in world with a net worth of $26.4 billion.

    venetian macaoWhat's really at issue here isn't money, it's Las Vegas Sands' potential violation of the Foreign Corrupt Practices Act.

    The law bars American companies from bribing officials overseas for business (from the Department of Justice):

    ...Specifically, the anti-bribery provisions of the FCPA prohibit the willful use of the mails or any means of instrumentality of interstate commerce corruptly in furtherance of any offer, payment, promise to pay, or authorization of the payment of money or anything of value to any person, while knowing that all or a portion of such money or thing of value will be offered, given or promised, directly or indirectly, to a foreign official to influence the foreign official in his or her official capacity, induce the foreign official to do or omit to do an act in violation of his or her lawful duty, or to secure any improper advantage in order to assist in obtaining or retaining business for or with, or directing business to, any person.

    The Las Vegas Sands has three casinos in Macau, so if Suen wins this lawsuit, it could open the floodgates to dealings that began in 2001 when the Macau government invited bids for casino concessions for the first time.

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    Vito Nicastri

    Last night Italian authorities confiscated $1.6 billion worth of assets from the Italian "Lord of the Wind," energy mogul Vito Nicastri, the AFP reports. This is the largest seizure of mob-linked assets in Italian history.

    Authorities believe that Nicastri has ties to the mafia — and not just any mafia, the Sicilian crime family headed by Matteo Messina Denaro, the so-called "Boss of all Bosses."

    From AFP:

    "This is a sector in which money can easily be laundered," Arturo de Felice, head of Italy's anti-mafia agency, told news channel SkyTG24 today. "Operating in a grey area helped him build up his business over the years."...

    Nicastri had "numerous and high-level contacts with mafia figures" the anti-mafia agency said, adding that this had been confirmed by messages found during the arrest of two local mafia bosses.

    Matteo Messina DenaroAs for Denaro, he's been on the World's (and Italy's) Most Wanted List for years. He's headed the Cosa Nostra since 2006 and is also known as 'Diabolik' after a cult Italian comic strip criminal.

    Arrest attempts in 2010 (after authorities were able to reconstruct Denaro's DNA) and in 2011 failed. Denaro's still at large, leading the mafia and still very feared despite this and other recent mafia linked asset seizures.

    According Sicilian paper Gazetta del Sud authorities have received information indicating that Denaro is plotting to kill a Sicilian prosecutor.

    From Gazetta:

    Details of Messina Denaro's alleged assassination plan against Palermo prosecutor Nino Di Matteo were contained in two anonymous letters sent to Palermo prosecutors a few days ago, sources said. The government has ordered Di Matteo's police protection to be beefed up.

    Scary stuff.

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    harold sue ann hamm

    Billionaire oil baron Harold Hamm's pending divorce from his wife, Sue Ann, is expected to go down as the costliest divorce settlement of all time.

    Hamm, the CEO of Continental Resources, is worth more than $11 billion, and he may have kiss half of that fortune goodbye, according to Reuters.

    The reason: Sue Ann held high-rankings positions at his company and helped Hamm build it into the multi-billion-dollar business it became. 

    "[Sue Ann] not only contributed to the marriage but she also contributed directly to the business," Jeffrey Cohen, a New York divorce attorney who has handled cases for high-profile clients like Mark Anthony and Lou Reed, told Business Insider.

    "Instead of having an A for being a good wife, she gets an A for being a good wife and an A for being (in) a business partnership."

    Even for couples that don't live in a community property state like California –– where married couples' finances are typically split 50/50 ––  joint business ventures still play a major role when courts decide how to divvy up the finances.

    "Being directly involved in the growth of any marital business venture is going to be the belt and suspenders [of your case]," Cohen said. "It's going to be an additional way to fortify your contribution and entitlement."

    Harold founded Continental in 1967. He and Sue Ann were married in 1988 and she worked for Continental, including forming the company's oil and gas marketing groups.

    Some of the oil company's most explosive growth occurred while the two were wed. Hamm discovered new oil fields in North Dakota in the 1990s that led to huge growth for Continental. Since going public in 2007, the share price has ballooned by 500 percent, according to Reuters.

    Cohen said that growth would be seen as "shared growth" in divorce court. And while he doesn't expect Sue Ann to receive quite half of her husband's hefty 68 percent stake in the company, he expects she'll walk away with a significant chunk of cash.

    "This is a heck of a case," he said. "I don’t see her getting quite 50 percent, but more than she could ever use in her life."

    SEE ALSO: People are getting married later, and that's great for women >

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    Steve Cohen

    Reports surfaced a couple weeks ago that billionaire hedge fund manager Steve Cohen, whose SAC Capital has come under scrutiny lately, secretly bought Picasso's "Le Rêve" from Steve Wynn for $155 million. 

    It was assumed that Cohen had just purchased the painting after settling a $616 million insider trading probe with the Securities and Exchange Commission.  

    That's not the case.

    Cohen's art dealer went on record to clarify the timing of the purchase in an interview with the New York Times last week. Even Cohen gave a ten word comment on the record in a rare interview. 

    The news was buried in an article about Cohen's ex-wife having her suit against him reinstated: 

    DealBook's Peter Lattman and Carol Vogel report: 

    Sandy Heller, Mr. Cohen’s art adviser, said on Wednesday that the sale was completed in early November of last year, a few weeks before the insider trading cases against SAC Capital entered a more serious phase with the indictment of one of his former employees. The purchase price was $150 million, not $155 million, according to people with knowledge of the transaction.

    “The timing was bad,” said Mr. Heller, referring to last week’s reports about the Picasso purchase. “We’re correcting the chronology.”

    In an interview Wednesday, Mr. Cohen, a collector who also owns works by Jasper Johns and Damien Hirst, said that he had coveted “Le Rêve” for years. “When you stand in front of it, you’re blown away,” Mr. Cohen said.

    Now that's settled. 

    (Hat Tip: ShaneFerro)

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    azzam yachtAzzam officially became the largest yacht on the high seas when it launched in Germany earlier this week.

    While its new owner is unconfirmed, it's believed to have been constructed for an Arab royal and cost around $627 million to build.

    How does Azzam stack up? Here are the 22 largest yachts in the world, based on a larger list from Superyacht Times (head there to see the 100 biggest yachts).

    22. Roman Abramovich's "Luna"— 377.3 feet long (2010)

    21. Roman Abramovich's "Pelorus"— 377.3 feet long (2003)

    20. "Issham Al Baher"— 379.79 feet long (1973)

    See the rest of the story at Business Insider

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    Izuckerberg gatest's common knowledge that success is two-parts hard work and one-part luck. But what about smarts? Are the world's richest people really the most intelligent people around?

    Pretty much, yes, according to new research by Duke University's Jonathan Wai, sent to Business Insider and first reported by CNBC's Robert Frank.

    Wai found that within the top one percent of smart people, the smarter you are, the richer you are.

    Overall, billionaires tended to be the smartest people. Some 45% of them are part of the top 1% of smart people. That compares to 39% of not-billionaire Fortune 500 CEOs; 41% of Senators, and 40% of federal judges.

    Tech billionaires and those who made their money from investments seem to be the smartest of all. Wai found that 63% in tech and 69% in finance were among the brainpower elite.

    Billionaires who made their money in fashion and retail, food and beverage weren't as brilliant. About one-quarter of them were brainiacs.

    Wai came to these conclusions by looking at the colleges these people attended. If they went to one of 29 "elite colleges," there were considered to be among the top 1% of smart people. These schools require high test scores for admittance and that indicates very high intelligence, he reasoned.

    You can argue that this is a pretty flawed way to measure intelligence. It automatically filters out smart people who didn't attend elite colleges and automatically assigns a high IQ to those were accepted because their parents were alumni, or they got an athletic scholarship. Wai acknowledges that flaw but says those two exceptions balance each other out.

    Interestingly, this research runs counter to a study done in 2007 by Jay Zagorsky, at Ohio State University.

    Zagorsky's study found no correlation between wealth and IQ. It looked at people who did well on the Armed Forces Qualification Test and how their wealth grew over time. While smarter people did earned bigger salaries, they were no more likely to become super rich over time than those with an average IQ.

    So maybe the answer to the question of wealth and smarts is this: It won't automatically make you a billionaire but it certainly helps.

    SEE ALSO: The Most Controversial And Entertaining Things Larry Ellison Has Ever Said

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    business manMartin Graham, chairman of London's Oracle Capital Group, knows a thing or two about millionaires.

    His wealth consultancy firm manages several billion dollars for about 40 European families, most of whom are self-made entrepreneurs. 

    "They're brilliant at running their company, but may not be brilliant at handling their own money," said Graham, who is also a former Director of Markets for the London Stock Exchange

    The goal of most millionaires is two-fold: to keep getting richer and to protect the riches they've already earned.

    The good news for the more modestly-heeled consumers out there is that the super wealthy don't have any secret skills that the rest of us can't imitate.

    We asked Graham to share a few guiding principles that anyone –– whether you make $50,000 or $5 million –– can use to better manage their money.

    1. Only invest money you have for the long-term. Unless you've got a nice stash of emergency funds on hand first, you have no business meddling in the stock market. Here's the rule of thumb Graham typically goes by: "Don't invest money that you can't lock away for five years." 

    2. Don't invest in anything that you don't understand yourself. When it comes to investing, individuals often have an edge over the professionals, Graham said. For example, when famed British retail chain Marks & Spencer brought in new product lines and lost touch with customers in 2012, it wasn't stock analysts who picked up on it first. "The man on the street knew that," Graham said. "You should invest in things you understand because the experts can get things wrong."

    Martin Graham3. Don't sit on your investments for too long. We've all heard it before, but Graham emphasized the need to diversify your investments, both by location and industry. It's important to have some downside protection in the markets world, and you probably will need to shift around investments on occasion, he said. That doesn't mean spending hours a day trading obsessively or trying to beat the market. Prepare a plan with a financial advisor on how often you should rock the boat.  "Be prepared to rebalance your portfolio to get the best returns from time to time, " Graham said, especially as you age and are less willing to take risky bets with your nest egg.

    4. Go against the crowd. The markets –– and the media that follow them –– aren't always right. Gold was everyone's investment du jour a year ago, and now it's tanking faster than the Titanic. And who could forget the Dot Com boom of the early 00's and 2008's crippling housing crisis. Don't be afraid to buck the trend and invest in things that aren't getting all the attention sometimes. "You need to be brave to buy against market sentiment," Graham said. As always follow the golden rule of buying low and selling high. 

    5. Prepare for a rainy day. The no. 1 goal of the rich is to protect their wealth at all cost. "A lot of our clients are interested in preserving wealth for future generations," Graham said. That means making sure that they are prepared for any business or personal circumstances that may pose a threat. For most people, that could be as simple as losing a job or going through a divorce. You could invest all day in the market or buy up a chunk of cheap real estate, but without liquid assets to depend on in leaner times, you won't get far.

    SEE ALSO: 10 states where the most people live on the edge of financial ruin >

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    soldier, army, switzerland, tilt shift

    Switzerland is under siege

    By 2020 the country will have lost its position as the number one destination for the wealth of the world's super rich to Singapore, says a report from private banking research group WealthInsight.

    The report is their annual Family Office briefing, a deep dive into where money is moving in the most exclusive investment clubs in the world — in elite wealth management, family and multi-family offices. In 2011, it was a $19.3 trillion industry.

    Switzerland had $2.8 trillion of that money. That's 34% of the pie, and more than anywhere else in the world.

    But that's changing, and fast. Partly because governments have been scrutinizing traditional private banking centers like Luxembourg and the Caribbean lately, so the rich are looking for quieter places to base their cash.

    However, WealthInsight also points out that the newly rich in countries like China and Indonesia are contributing to this move as well. Most emerging markets have a growing number of rich people, but lack the banking structure to service them.

    Enter Singapore, a quick plane ride for Asia's wealthiest with a well-regulated banking sector. It also has a head start in the private banking. Singapore-based Portcullis TrustNet, for one, was mentioned in a recent International Consortium of Investigative Journalists report about how the super rich invest in tax havens with the help of talented private bankers.

    In 2011 Singapore had $550 billion worth of private banking assets under management, in 2000 it had only $50 billion. That's massive growth that WealthInsight doesn't see that slowing any time soon.

    So it sounds like they'll have no problem playing catch up.

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    Stephan Bonnar (top) and Kyle Kingsbury (bottom) during an UFC Light Heavywieght bout at the HP Pavillion

    A number of the 34 individuals accused of running an international gambling ring based in the U.S. and Russia were arraigned in a New York City Courtroom yesterday, and that means more juicy details about the organization's clandestine activities.

    According to an indictment filed by federal authorities earlier this week, for years the Nahmad-Trincher and Taiwanchik-Trincher groups catered to the poker and sports betting needs of the world's most rich and powerful — oligarchs, Hollywood stars, Wall Street bankers and more.

    All the while, they laundered their ill-gotten gains through banks and businesses all over the world, using violence to intimidate clients when they could not settle their debts.

    At yesterday's arraignment, reports GalleristNY, Judge James C. Francis spent most of his time on Arthur Azen. Azen faces 115 years in jail, more jail time than any other defendant, and a $2.25 million fine.

    Even though he wasn't a leader of either Trincher group, the prosecution argued that Azen had a hand in every sector of the gambling business, collecting money, distributing it through the organization, and making sure that debts were paid.

    From GalleristNY:

    “Mr. Azen’s job is basically to suck money out of Titan and funnel it to” other defendants, said one of the prosecutors.

    The prosecution also stated that Mr. Azen sent mixed martial arts fighters to collect from one of the Nahmad-Trincher organization’s debtors. The federal agents monitoring Mr. Azen were apparently “so concerned” for the wellbeing of a person who owed money that they intervened on one occasion by sending in police officers to protect the debtor.

    The defense explained that Mr. Azen was “managing and promoting” mixed martial arts fighters, not using them to intimidate debtors.

    The Trincher groups' alleged leaders were not at the arraignment, and getting them to a NYC Courtroom may be a delicate and diplomatic operation.

    According to authorities, the leaders of the Trincher groups were Alimzhan Tokhtakhounov, Vadim Trincher, his son Ilya Trincher, and billionaire art dealer Hillel "Helly" Nahmad.

    Tokhtakhounov, based in Russia, has been in trouble with U.S. authorities before. He was accused of trying to rig the Salt Lake City Winter Olympics and was detained at his Tuscan villa in 2002.

    The "Vor" (basically Russian for "Godfather") managed to stay in Europe, however, when Italian authorities overturned his extradition order to the United States. He has been linked to powerful politicians in Russia, including Vladimir Putin, says the NYT.

    Helly Nahmad is another story. The police raided his family's Upper East Side gallery on Tuesday, but he was in Los Angeles where he was supposed to surrender to authorities later that day — he has yet to be found.

    The Nahmad family is one of the wealthiest art dealing families in the world. Their roots are in Aleppo, Syria where the family scion (also named Hillel) first made his mark on the world of banking.

    Eventually, the family made its way to Europe and then to NYC, where one of the two Helly Nahmad Galleries is located.

    The family is known both for its incredible up to 5,000 piece private collection (90% of which is held in storage) and its secrecy. Forbes estimates 34 year-old Helly's father's wealth at $1.75 billion.

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    Google Larry Page Sergey Brin redStory #1: 

    One time Barry Diller was visiting Sergey Brin and Larry Page. The topic of the meeting was to see how the greatest media mogul could work with the greatest Internet moguls.

    It was like two galaxies colliding to create something beautiful when seen from light years away.

    Larry Page was texting or doing something on his phone.

    Barry Diller was disgusted: “Either choose me or the phone”.

    Larry Page, without even lifting his head from his phone, said to the biggest media mogul in history, “I choose this”. Referring to his phone.

    So Diller spent the rest of the meeting talking to Sergey Brin.

    Story #2:

    It’s very hard to get a job at Google. They are even making a movie out of the process.

    They used to make movies about things like the Vietnam War. Or about preventing Mars from crashing into Earth. Or about a young blonde boy being chosen by a wizened hermit with psychic powers to save the galaxy against his father who wears a black helmet all the time.

    Now they are making a movie about how hard it is to get a job at Google. “A sort of Hunger Games for nerds” as Vince Vaughn says in the trailer.

    But in the early days, Sergey Brin would interview every candidate.

    Like, on a date, you immediately know within five seconds whether you want to have sex eventually with the person you are on the date with.

    Sergey Brin would know right away if he was interested in hiring the person.

    If he wasn’t interested, he said, “I would try to spend the next hour trying to learn at least one thing from the person so that the meeting wasn’t a waste for me.”

    From Story #1 I learn the most important rule of my life: don’t have meetings with someone you don’t want to have a meeting with.

    Claudia said to me, sounds like Larry Page was just being rude.

    I don’t know. I don’t want to judge. Who knows the dynamics of these billionaire meetings. Too complicated for me.

    But you are what you eat. I don’t have meetings with people I don’t like. Ever. Else I can feel it somewhere in my body…I feel bad. Why feel bad? It’s my choice to feel bad or good. If I ate glue I’d probably feel sick. I won’t do that either.

    Larry Page could’ve been busy kissing his wife instead of meeting with Barry Diller. Instead, he was probably texting his wife. He was probably texting, “I hate Barry Diller”.

    Texting? Kissing?

    Kissing? Texting?

    Of course it’s nice that he’s so honest and blunt. Maybe I could learn that also. I feel I am pretty blunt but the way to avoid being rude is to not be blunt to people you don’t like. So it’s simple again: avoid people I don’t like. Larry Page doesn’t like Barry Diller.

    So Lesson number one, don’t have meetings with people you don’t like. Life will be better for me if I’m sitting in a park thinking about nothing instead of having meetings with people I don’t like.

    The second story is a little harder. Yes, it’s good to learn from everyone you meet.

    But if I just hoard everything I learn, I might end up with a very big head.

    I feel bad for these guys being interviewed. They are probably scared shitless. And here’s Sergey, already decided he’s going to pick some fact from their brain.

    Like maybe the person Sergey is interviewing is an expert on whales.

    No need for whale people at Google! But can I eat whale flesh? Does whale loin make a good sandwich? Are whale fats healthy for my testosterone?

    Too many facts! I don’t need to know so much about whales.

    I think Sergey’s rule should be to do the opposite of what he does. 

    Should I urn a rule on it’s head if it’s a rule coming from the most successful, the smartest, and perhaps the sexiest man on the planet?

    I don’t know. I want to be a good person. I want to be free from worry.

    People say, “are you the signal or the noise?”


    I don’t need to be the signal or the noise.

    So I make my own rules for me.

    What if I try to GIVE to each person I meet, even if I know there will be no further contact. Even if I don’t learn anything.

    Don’t do it in a creepy way. Like, “Here are some chocolates little boy!”

    And you don’t want to be patronizing either. Like, “you should really be up on your Shakespeare, young man.”

    But what if you really listen to the person, not to steal away his few morsels of knowledge but just to listen to him. Or just be kind. Maybe that’s the gift he needs.

    I don’t know.

    What can you do to give to everyone you meet? Or everyone you see. It’s hard! I’m going to try it.

    [See, "Give and you Will Receive"]

    I admit: I’m jealous of Larry Page and Sergey Brin. I want to play with my phone while saying, “I choose this” to Barry Diller. I want to make the world’s biggest website and cure cancer at the same time.

    I want to be the cool guy on the subway with $18 billion and wearing the first wearable computing on the planet.

    I want.

    Give me.

    But maybe I also want to kiss instead of text. Be QUIET instead of MEET.

    And feel like I have something to offer to everything around me, even in the smallest of ways. I want to exude abundance when I give to everyone I meet. I don’t need to take more facts.

    That makes sense.

    I’ll never have a job at Google. I’ll never be the master of the galaxy.

    But I like having Sergey Brin and Larry Page as my reverse-mentors. Thank you very much.

    [Follow me on Google+ please!]

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    Billionaire hunters take note.

    Research firm WealthInsight tracks high net worth individuals, and in their latest report, the firm has ranked the top 20 global cities where billionaires live, down to how many of them reside in each city.

    We were surprised that there were only 70 in NYC, but it still tops the list, with Moscow, London and Hong Kong following in that order.

    Check out the table below:

    wealthinsight top billionaire cities

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    Vodka Martini

    Bloomberg News' Zeke Faux has this fascinating story about billionaire Carl Icahn from his early days on the Street working as a young broker.  

    This is an unconfirmed story, but we could totally see this happening.  From Bloomberg News:

    Billionaire investor Carl Icahn’s first Wall Street job was at Dreyfus & Co., according to his website. A former colleague who asked not to be identified because he still works in the industry said he knew Icahn would be successful when the colleague was trying to pick up a woman at a dance at a Catskills resort and saw Icahn sign up her father as a client. Icahn and Weill didn’t respond to messages seeking comment.

    Well played, sir.

    [Hat Tip: Kevin Roose]

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    Kirk Kerkorian

    Legendary Las Vegas hotelier Kirk Kerkorian's ex-wife says that he's being held hostage by managers of his holding company, Tracinda Corp, TMZ reports.

    In Court documents, Lisa Kerkorian says that Kirk hasn't been seen in public since June 2012 — not even to occupy his regular lunch table at the Polo Lounge at the Beverly Hills Hotel.

    She fears his managers are controlling him, and separating him from their daughter, Kira.

    From TMZ:

    Lisa and Kirk were possibly in the nastiest celebrity divorce in Hollywood history, yet now Lisa has gone to court on behalf of her daughter to seek the appointment of a conservator to manage Kirk's affairs and pave the way to re-establish a relationship between Kirk and Kira...

    And one more twist ... Kira isn't even Kirk's biological daughter, but he raised her as his own.

    A rep for Tracinda tells TMZ, "There are no facts to support Bonder’s claims and therefore no merit whatsoever to the allegations she has made."

    The billionaire and former owner of MGM Studios is 95, and is the 412th richest person in the world, according to Forbes.

    He started out in the world of Las Vegas casinos in 1962 after purchasing 80 acres of land on the Las Vegas Strip. He bought MGM in 1968.

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    bison in yellowstone

    America's ultra-rich want to bring back the bison.

    A number of hotshot investors from Wall Street and Silicon Valley have given some $60 million trying to build their very own "American Serengeti" in Montana, according to Bloomberg Pursuits.

    An organization called the American Prairie Reserve is behind the project, which has so far attracted billionaires such as candy heirs Forrest Mars Junior and his brother John, German retail baron Erivan Haub, and a slew of others.

    The group hopes to buy up some 3.5 million acres of land (that's bigger than Yellowstone National Park), and introduce 10,000 purebred bison, along with deer, antelope, coyotes, and prairie dogs.

    They aren't the only tycoons with a passion for the embattled species: media mogul Ted Turner, who is the second-largest landowner in the U.S., is raising some 50,000 head of bison out west and has fought to keep several dozen bison calves born at Yellowstone on his private ranch.

    Eventually, Prairie Reserve plans to open it to the public, much like a national park, and built a "safari camp" for visitors to the prairie, Bloomberg Pursuit's Seth Lubove reports.

    But one group is furious about the plan. Local cattle ranchers, who are being offered as much as $2,000 an acre by Prairie Reserve, say the reintroduction of bison would destroy their livelihood.

    “In order to build their 3-to-4-million-acre vision, I can’t live here,” rancher Leo Barthelmess Jr. told Bloomberg. "This landscape was broken in the Dust Bowl of the 1930s. Ranchers and the Soil Conservation Service worked and brought this prairie back...It doesn’t need to be saved from ranchers; it was already saved by ranchers.”

    But with many of the ranchers "land rich and cash poor," the big money behind the project may prove too tempting to resist.

    Read the full report at Bloomberg.

    SEE ALSO: George Lucas Is Still The Proud Owner Of Skywalker Ranch

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    Michael Bloomberg

    New York Mayor Michael Bloomberg now owns 14 properties worldwide after purchasing three Hamptons estates in as many years, Capital New York's Dana Rubinstein reports.

    In 2011, he bought a $20 million, 35-acre estate in Ballyshear.

    He has since acquired an adjacent home as well as a nearby 4.8 acre vacant plot of land.

    Bloomberg also owns property in London, Colorado, Bermuda and Florida.

    For the first time ever, he also disclosed that he has personal HSBC bank accounts in London, Paris, Bermuda and Hong Kong, in addition to his accounts in America.

    Read the full story at Capital New York >

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    interpipe_sunTethered high above Victor Pinchuk’s newest steel smelter at the Interpipe plant, visible for miles around the eastern Ukrainian city of Dnepropetrovsk, is a large balloon. It’s meant to symbolize what the Interpipe website is calling the smelter’s state-of-the-art technology — “the construction plant has no harmful effect on the atmosphere or social surroundings”; also its historical uniqueness in the steel industry west of the Russian border – “a vital step in the development of the domestic Ukrainian pipe industry.” For the curious and for asthmatics, Interpipe is offering guided tours of the plant to demonstrate how it “marks the beginning of a green era in the metallurgical industry.” The plant’s press office says the balloon construction is called Sun Interpipe. “It’s an art object, and we are not going to remove it.”

    Less intentionally, the balloon symbolizes the sky-high cost of building the smelter and supplying it with electricity; Pinchuk’s growing billion-dollar debts; and the collapse of demand for the steel products Pinchuk is offering for sale in Ukraine and Russia, Interpipe’s make-or-break markets.

    Although Interpipe remains privately held by Pinchuk, documents the company has prepared with his bankers to cover his debts, together with bank sources, reveal how strapped for cash Pinchuk is. The balloon is also going up for Pinchuk, as he tries to raise at least $143 million, perhaps ten times as much, from a claim filed in the UK High Court against two rival Ukrainian metals magnates, based on recollections of meetings Pinchuk and the others held in the Ukraine, Israel, Sardinia, and Switzerland, starting nine years ago.

    An unusual internet release by Pinchuk’s investment unit, EastOne, provides a four and a half-minute interview with Pinchuk’s lawyer, Oleg Mubarakshin, and a one-page text summarizing the London claim. This was filed, the text says, on March 12, 2013. A coordinated release of the material produced a spate of near-identical newspaper reports in the Ukraine, three in Russia, and one in London.

    According to the claim summary, in 2004, when Leonid Kuchma was President of Ukraine, an iron-ore mining company called Krivorozhskiy Zhelezorudnyy Kombinat (KZhRK) was privatized for $130 million. Pinchuk was Kuchma’s son-in-law. He claims that Gennady Bogolyubov and Igor Kolomoisky, two rival steelmakers and partners in the Privat banking group, agreed “through a qualifying entity” to bid and buy the asset from the government. They then, allegedly, “undertook to transfer KZhRK to Mr Pinchuk upon being reimbursed the purchase price of $130 million plus a 10% ($13m) commission. Mr Pinchuk duly paid the full US$143 million but the asset was not transferred to him.”

    victor pinchukPinchuk says he took operational control of the mine. But in March of 2005 he was ousted by “persons believed to have been acting on the instructions of the defendants [who] forcibly entered the premises of KZhRK and took control of the plant.” Another eighteen months elapsed, and then on September 4, 2006, the trio allegedly met together. What happened next is the core of Pinchuk’s lawsuit: Bogolyubov and Kolomoisky, according to Pinchuk, “declared a trust in respect of KZhRK in favour of Mr Pinchuk, and gave him various undertakings regarding its transfer. In breach of trust and contract, Mr Bogolyubov and Mr Kolomoisky have failed to transfer KZhRK to its rightful owner, Mr Pinchuk, and it appears that they may have sold approximately 50% of KZhRK to a third party in 2007.”

    Rinat Akhmetov, another Ukrainian metals magnate and owner of four steelmills, is identified by Pinchuk as the buyer of that stake in KZhRK. Pinchuk is also claiming that Akhmetov is a witness to the deal-making he undertook with Bogolyubov and Kolomoisky.

    Mubarakshin — a Moscow-trained lawyer who worked for the beer group Inbev before joining Pinchuk — identifies in his video clip “repeated promises”, and a great deal of talking. “For years and years”, Mubarakshin said, “we tried over and over again, but every attempt at reaching agreement failed [because] Mr Bogolyubov and Mr Kolomoisky didn’t do what they said they would do.”

    White & Case are the solicitors for Pinchuk, led by David Goldberg, a Russia case specialist. The barrister is Antony Grabiner QC, appointed a baron in 1999. Recently, Grabiner has been engaged to defend Rupert Murdoch’s News Limited against charges of illegal hacking and bribery of police.

    Mubarakshin was asked to identify the place where the Ukrainians met in September 2006 for the meeting on which Pinchuk’s contract and trust claims depend. He and the court papers confirm it was Geneva. According to the 23-page Particulars of Claim, filed by Pinchuk’s lawyers, what was said in Geneva was “an oral agreement…in part evidenced in writing”. There was also a handshake. But the Pinchuk group declines through its spokesman at Maitland, a London public relations firm, to make available a copy of signed documents of contract or trust which Pinchuk is alleging to have been breached.

    Pinchuk’s lawyers also reveal that Bogolyubov wasn’t at the Geneva meeting, so there is no evidence that he shook hands or participated in what was said. See Section 31, page 11 of the Particulars of Claim here.

    Briefed independently, the Financial Times (FT) cites Pinchuk himself as conceding the evidence for his claim “was mainly made verbally.” The FT also cautioned that “the risk of a dispute centered on verbal agreements was laid bare in the case of [Boris] Berezovsky.” The FT report conveys doubt “if the case reaches trial”.

    The itemization in the court papers of the meetings Pinchuk believes will substantiate his $143 million deal refers to “oral agreement”, the terms of which allegedly depend on the recollection of witnesses. These include the principals, their employees, go-betweens, and in one meeting, an Israeli rabbi named Shmuel Kaminetskiy.

    Bogolyubov is not commenting, and neither is his law firm Freshfields.

    Independent sources believe there was a meeting in Geneva between Pinchuk and Kolomoisky. But they say there is documented evidence that it was impossible for there to have been any trust, let alone a shareholding contract, between them at the time. The sources identify a substantial claim filed in US federal court in Boston by Kolomoisky in March of 2006, charging Pinchuk with fraud, money laundering, and racketeering in relation to another Ukrainian asset, the Nikopol Ferro-Alloy Plant. In that case, Pinchuk, an American cousin of his, and a second American, along with Interpipe and associated trading companies, were accused of an elaborate asset and trading scheme, which depended in the first instance on Pinchuk’s closeness through his wife, Elena Kuchma, to the Ukrainian president.

    “In 2002,” one of the court submissions alleges, “ Pinchuk, as President Kuchma’s future son-in-law, was able to exercise effective control of Nikopol. Using his family connections, Pinchuk caused Nikopol to enter into a series of self-dealing contracts clearly designed to siphon hundreds of millions of dollars of Nikopol’s profits annually to entities controlled and/or beneficially owned by Pinchuk, Margulis, and/or Novack. These contracts caused Nikopol to (a) purchase raw materials (ore) at above market prices from entities related to Pinchuk, Margulis, and Novack and sell the finished product at below market prices to entities also controlled by Pinchuk, Margulis, and Novack; and (b) enter into unnecessary, profit-skimming tolling contracts, whereby Nikopol was paid a fee for processing ore, while other companies controlled by Pinchuk, Margulis, and Novack reaped the profits associated with selling the finished product on the open market.”

    The illegal scheme, alleges the Boston court claim, dated March 30, 2006, involved “racketeering activity, including wire fraud, and, upon information and belief, acts of bribery (in violation of the Foreign Corrupt Practices Act), money laundering, foreign travel in aid of racketeering, and illegal monetary transactions.”

    Pinchuk himself was charged with having “used Kuchma’s influence to extort Ukrainian officials and secure their cooperation and assistance in carrying out the schemes.” Privatization of Nikopol in Pinchuk’s favour, according to a source cited in the US court documents, resulted in Pinchuk paying $80 million for an asset reportedly worth $1 billion. Details of allegedly fraudulent trading schemes are provided in the dossier; these continued through 2004 and 2005, and followed the victorious presidential election campaign by Victor Yushchenko, who took power early in 2005.

    Loss to Nikopol of several hundred million dollars, plus treble damages under the US racketeering statute, were sought. The case was settled out of court, however, and the lawyers involved say they cannot comment. The new Pinchuk filing in the High Court reveals that the confidential settlement between Kolomoisky and Pinchuk occurred on November 22, 2006.

    In Pinchuk’s London filing, he claims the Boston case was directly connected to the KZhRK deal. “The Defendants [Bogolyubov and Kolomoisky] sought to impose pressure on the Claimant [Pinchuk] to agree to their proposals by procuring the institution on 30 March 2006 of proceedings by certain of their companies (namely Athina, Varkedge and Wisewood) against the Claimant in Massachusetts, USA, in which spurious allegations and claims were advanced under the Racketeer Influenced and Corrupt Organisations Act.”

    Why in parallel, between 2004 and the meeting on September 2006, Kolomoisky and Bogolyubov would, as Pinchuk charges, trust him with shares to the KZhRK remains to be clarified. Pinchuk is now alleging that the others broke the Nikopol settlement agreement, accusing them of having “acted in breach of the Claimant’s rights under the Constitution and the Beneficiaries Agreement in relation to the Ferroalloy Holding.” This claim, which has not been litigated before, is excluded from the ZhRK claim.

    Mubarakshin was asked why Pinchuk didn’t buy the shares himself from the government. He responded through a spokesman that Ukrainian privatization rules at the time required that bidders for KZhRK had to qualify to buy the asset by holding at least 25% in the group from which KZhRK was being sold. Pinchuk didn’t qualify; he claims Bogolyubov and Kolomoisky did.

    The record of meetings which followed over the next nine years names 15 witnesses.

    By attacking the record of the US court case, and opening up its confidential terms, Pinchuk is putting his credibility in the US to an unusual test. That credibility is also exposed to scrutiny in records filed at the Foreign Agents Registration Act (FARA) bureau of the US Department of justice. These reveal that Pinchuk is currently paying an American lobbyist $40,000 per month to arrange meetings for him with high US officials, such as Hillary Clinton when she was Secretary of State. Clinton appears to have refused an attempt Pinchuk financed last year to promote a Ukrainian election endorsement by Clinton by meeting “with Arseny Yatsenuk, leader of the United Opposition, during the week of September 3, 2012 regarding democratization and free and fair elections in the Ukraine.”

    Pinchuk has promoted his wealth through Forbes, which claims he is worth about $3.8 billion, based on estimates about Interpipe. According to Forbes, “the majority of his wealth comes from traditional pipe manufacturing; this past year, his Interpipe launched a $700 million steel plant, the first such plant build from scratch in Ukraine since 1991. Other parts of his diversified empire have not fared as well.” Pinchuk refers to himself in the court documents, together with Bogolyubov and Kolomoisky, as “billionaire Ukrainian businessmen”.

    Pinchuk’s claims unexpectedly invite an accounting of his financial position, net of debt. Interpipe says its financial report for 2012 has been delayed, and there are no IFRS interim reports since the July 4, 2012, publication of the 2011 results. An analysis of the 2011 financial report indicates that Interpipe depends on Ukraine for 36% of its revenues, 25% on Russia; it was much the same in 2010. The asset concentration is even more dependent – 92% in Ukraine. The gross debt identified in the report is $1.026 billion.

    At page 41 of the 2011 financial report, it appears that Interpipe’s banks have tried to secure themselves against the disappearance of trade proceeds by requiring Pinchuk to implement two cash pledges of $270 million and $160 million “arising out of certain intra-group sales contracts” and between trading subsidiaries and “their ultimate customers”. Combined, those pledges represent 26% of the sales revenue reported for 2011. As a condition of Interpipe’s bank debt restructuring terms, an override agreement with the banks also required Pinchuk to pay $65 million in fresh capital into Interpipe, plus a $40 million letter of credit – see Note 17. The terms also barred payment of dividends to Pinchuk (page 41). What therefore can be Pinchuk’s income if he has been denied dividends from Interpipe since 2010?

    The evidence to answer that question is scanty, but it raises the possibility, made explicit by the Financial Times, that like Boris Berezovsky’s attempt to sue in the High Court for cash from Roman Abramovich, Pinchuk is trying a similar stratagem.

    The 2011 financial report indicates Interpipe’s earnings (Ebita) for 2010 to be $169.5 million; $255.5 million for 2011. By calculating Pinchuk’s “net worth” as of March 2013 at $3.8 billion, Forbes is in effect calculating the market value of Interpipe at $3.8 billion. Assuming the 2012 Ebita to be not less than the 2011 figure, this suggests an Ebita-market cap multiple for Interpipe of 15x. This looks to be an exaggeration.

    TMK, Russia’s leading pipemaker, is an obvious peer for comparison, even though it is four times larger than Interpipe by sales revenue. For TMK the ratio of Ebita to market cap is around 3.5x. The Forbes calculation of the “net worth” of Dmitry Pumpyansky, the control shareholder of TMK, is reported to be $2.2 billion. This Forbes calculation is a direct extrapolation from Pumpyanksy’s 70% shareholding in TMK. Comparing the Forbes calculations for Pumyansky and Pinchuk, the Pinchuk number appears to be unlikely.

    It is evident from Interpipe’s financials that Pinchuk is running an enormous financial risk on the revenue and profitability of the new EAF plant, and the capacity of the markets to absorb its products. This in turns depends on the currently depressed prospects for pipes and other steel products in the Ukraine, in Turkey, Russia and other export markets; on the reaction of rival Ukrainian consumers of the extra steel scrap Pinchuk’s new mill requires; and on Pinchuk’s efforts to hold down the price and profitability of the scrap business.

    According to Ukrainian sources, Interpipe currently depends on high-cost electricity supplied to Pinchuk by Akhmetov, whose testimony will be sought by both sides if the case goes to trial.

    The record presented so far by Pinchuk fails to identify a link to the UK for the assets in dispute, or the meetings allegedly held to settle on terms. The language the principals and their witnesses used appears to have been Russian.

    The little paperwork to which Pinchuk’s court claim refers was not in English, and according to the Particulars of Claim, it was drafted after the September 2006 meeting by Yulia Chebotaryova, an employee of Pinchuk’s since 1993 and currently chief operating officer of his investment unit,EastOne.

    Despite the acknowledgement in the court papers that Bogolyubov was absent from the key Geneva meeting in 2006, jurisdiction is held by the London court over the three Ukrainians and the Ukrainian mine, according to Pinchuk’s lawyer, because “Mr Bogolyubov is based in London” and also because “the claim against [Kolomoisky] is so closely connected with the claim against Mr Bogolyubov that it is appropriate they should be heard together.”

    The claim documents submitted by Pinchuk’s lawyers go one step further, arguing that when the meeting was held in Geneva Kolomoisky and the absent Bogolyubov agreed to be governed by UK law. Back in 2006 that was Pinchuk’s idea. “Following a suggestion by the Claimant [Pinchuk], the parties orally agreed that any disputes regarding the Constitution [deal terms] would be dealt with by the English Courts applying English law.” Whether Pinchuk can prove that or not, his lawyers have a fall-back position. This is that Bogolyubov is domiciled in London, though a source close to the Pinchuk side conceded that this may not have been the case when the September 2006 meeting took place.

    A recent court case initiated by Elena Pinchuk, Pinchuk’s wife, may be a portent of what’s to come in London. In that case, which went through US arbitration and the courts for six years, a Cyprus company controlled by Mrs Pinchuk refused to pay a Washington landscape architect $170,000 (rounded) for work on the grounds of the family home at a former state sanatorium near Kiev. The architect counter-claimed, and by the time the affair was settled this past January, the bill for the Pinchuks came to more than $500,000.

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    meadow lane billionaires southampton

    Some of the most famous millionaires on the planet own homes in the Hamptons.

    But even the 1% have a 1% — and in the Hamptons, there's no more ritzy and expensive address than Meadow Lane in Southampton, according to Forbes' Morgan Brennan.

    The median sale price on Meadow Lane last year was just under $18 million, according to Property Shark.

    And the five-mile road has a helipad to whisk residents off to Manhattan in under 20 minutes.

    Brennan recently wrote about the denizens of Meadow Lane for Forbes; we're taking a closer look at some of these mega-wealthy property owners and their mansions.

    Meadow Lane is one of the most expensive addresses in the country, and no wonder — it runs along a coveted beachfront strip in one of the most exclusive towns in the Hamptons.

    Source: Forbes

    The famous millionaires and billionaires who live there all reside within throwing distance on the same stretch of road.

    Source: Forbes

    Daniel Och, CEO of Och-Zipp Capital Management Group, has a 4-acre estate valued at $20.4 million with a 7,000-square-foot mansion.

    Source: Forbes

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    Hulu Summer Series- TV Shows(Reuters) - Satellite operator DirecTV and two other bidders have offered more than $1 billion apiece to buy Hulu, a source with knowledge of the bidding process said on Friday, increasing the likelihood that owners News Corp and Walt Disney Co will be able to shed the video streaming service they failed to sell in 2011.

    Hulu board members, who are being advised by Guggenheim Partners on the auction, fielded at least seven buyout offers last week, the source said.

    That number will be whittled down in the next two or three weeks, the source told Reuters on condition of anonymity because the process was private.

    It was unclear which two other bidders offered $1 billion for Hulu. The service has more than 4 million subscribers and generates revenue of about $700 million through subscriptions and a free ad-supported service.

    The proposed price tag heightens the likelihood that News Corp and Disney will find an acceptable offer price, which was the sticking point of the 2011 round of buyout negotiations.

    DirecTV spokesman Darris Gringeri declined to comment, as did Meredith Kendall, a spokeswoman for Hulu. Bloomberg first reported the news on Friday.

    Sources have said the other bidders are Yahoo, former News Corp president Peter Chernin, private equity firm KKR, cable operator Time Warner Cable, Guggenheim Digital, and Silver Lake Management and talent agency William Morris Endeavor Entertainment in a joint bid.

    Cable company Comcast is the third owner of Hulu alongside News Corp and Disney, but is precluded from an operational role as a condition imposed on it upon its acquisition of NBC Universal in 2011.

    (Reporting By Ronald Grover and Liana B. Baker; Editing by Toni Reinhold)

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    Xiaomi Technology

    Apple now finds itself being challenged in China, the country where most of its devices are assembled, by a billionaire named Lei Jun who is positioning himself as an acolyte of Steve Jobs.

    He isn't doing so without any justification, however. According to this profile in The New York Times, the Chinese media have nicknamed his company the "Apple of the East."

    Like Steve Jobs, Lei has a tendency to make exaggerated statements about what his company is doing. Here's what he told the New York Times: 

    We’re making the mobile phone like the PC, and this is a totally new idea. We’re doing things other companies haven’t done before.

    Of course, like Jobs, Lei has a penchant for making money. No company has ever generated $1 billion in revenue in China faster than Xiaomi. Last year alone, the company generated $2 billion in revenue by selling seven million smartphones, and it expects to double that this year, according to the profile

    Read the whole thing here >

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