Frankel, Martin (1955–)

MARTIN FRANKEL, A MONEY manager and former stock broker, orchestrated the largest insurance fraud in U.S. history. Frankel took over small insurance companies in several states, using pseudonyms and a variety of front persons and companies, and then stole their assets. He placed large sums of money in Swiss bank accounts, and financed an extravagant lifestyle that included international travel and expensive spending sprees.

Frankel was a Toledo, Ohio native who gained notoriety because of his illicit activities, and also because of his eccentric lifestyle. A stockbroker until he was barred from trading by the Securities and Exchange Commission (SEC) in 1992, Frankel continued in the field, running an unlicensed brokerage firm, Liberty National Securities, Inc. (LNS). In addition to LNS, Frankel ran two other financial fronts, Thunor Trust and the St. Francis of Assisi Foundation, all fronted by prominent figures, lending credibility to the scheme. Thunor Trust was Frankel's key vehicle for taking over insurance companies.

Thunor Trust purchased the companies, and placed the insurance premiums in its supposed investment firm, LNS, at which point Frankel would embezzle the funds. From 1990 to 1999, he took over several small insurance companies and collectively[Page 339] looted over $200 million in assets. The companies were housed in Oklahoma, Mississippi, Tennessee, Missouri, and Arkansas.

Frankel has been described as “a short, skinny figure with thick Woody Allen-ish eyeglasses” (always worn askew), who was “nebbishy” and “reclusive.” Nevertheless, his ill-gotten wealth allowed him to satisfy his appetite for sado-masochistic sex, courting women, including Eastern European women via the internet and through personal ads to his compound where he would address their material needs in return for favors.

Frankel kept approximately 20 women around the compound, and, in addition to providing them with office “jobs,” he purchased luxury cars and fur coats, and took them on shopping sprees in some of New York's most fashionable stores. His compound consisted of two mansions located in Greenwich, Connecticut's backcountry, a remote area of multimillion-dollar estates, woods, and horse trails. The primary property was a $3 million stone mansion, outfitted with video surveillance cameras, numerous offices, over 80 computers, and large screen televisions to watch various financial news programs. Frankel also owned a fleet of luxury cars in addition to a few private planes, and employed a host of bodyguards.