The Herald misses a big story

The Herald has been trying to write a conspiracy story about the 2015 elections for Assembly and Freeholder.  Last week they even reported that the new candidates  haven't filed campaign finance reports showing that they have any money. Why would they?  They have all just started their campaigns and the law doesn't require them to file a report with this information until 29 days before the primary election on June 2nd.

Yet the Herald dedicated a whole story to report, well, nothing.

Anyway, there is an important story with a local connection that you would have had to read about in the New York Times.  It involves the rich and powerful Mulvihill corporate family in Vernon.  We read about it two weeks ago and have been waiting ever since for someone at the Herald to pick it up.  Do they read the NY Times at the Herald? 

The story appeared on January 14th and it concerns a lawsuit filed that week in federal court by Anthony P. Miele III of Manhattan, whose deceased father left him stock worth $16,000. Mr. Miele contends he did not know for years about the stock, now worth $130 million, because his late father's business partners concealed its existence from him.   The Times writes:

At a meeting of Mr. Miele, Mr. Johnson, Mr. Mulvihill and Robert E. Brennan — a rising star at Mayflower who was later sentenced to nine years in prison for money laundering and bankruptcy fraud at First Jersey Securities — Mr. Miele agreed to lend Mr. Johnson $100,000. The money was to be used “to solidify the Winfield acquisition,” according to the complaint, which goes on to explain that although “no documentation of that loan appears to exist,” Mr. Johnson claimed it “was documented with a promissory note and listed on the public books and records of Franklin as part of its capital structure.”

Mr. Johnson also contends, according to the complaint, that 4,000 shares of Franklin stock were given to Mr. Miele as a bonus for providing the loan. According to the complaint, the stock certificate was issued to a trust that Mr. Miele established for his son, the plaintiff. A little more than a year later, Franklin’s records show that the 4,000 shares were voted at the annual shareholders’ meeting on March 21, 1974. Then on Nov. 8, 1974, while having dinner at Stash’s, Mr. Miele died “suddenly and unexpectedly,” apparently of a heart attack. Mr. Miele was 39; his son was 3.

According to the complaint, Mr. Miele’s son was never informed, until years later, of the existence of the trust with the 4,000 Franklin shares. At the time of Mr. Miele’s death, the shares were worth $4 each, for a total of $16,000.

The original 4,000 Franklin shares have turned into 2,531,250 shares, with a value of about $130 million, with an additional $20 million in uncashed dividends, according to the complaint. But through “a variety of acts including breaches of fiduciary duty, forgery, theft, diversion and a cover-up,” neither the shares nor the dividends have ever been delivered to Mr. Miele, it contends.

The complaint, drafted by Mr. Miele’s lawyers at Liddle & Robinson, contends that Richard Hanrahan, at the Bank of New York, offered to find Mr. Miele in the early 1990s, using the Social Security number it had on file, but Mr. Johnson and Franklin declined the offer. Instead, according to the complaint, when Mr. Johnson learned that New Jersey was about to take control of the trust because its owner appeared to have abandoned it, he asked Mr. Mulvihill to find Anthony Miele Jr. By then, Mr. Johnson, who was chairman of the National Association of Securities Dealers at the time, was most likely aware that Mr. Mulvihill had been convicted of numerous crimes, including forgery, and had been barred from the securities industry.

In any event, that is when Mr. Johnson says he learned of Anthony Miele Jr.’s death nearly 20 years earlier. Mr. Johnson then “delegated to Mulvihill” the responsibility of making sure the Franklin stock was delivered to his son, according to the complaint.

Mr. Mulvihill told Mr. Johnson “he would take care of it,” according to the complaint. At that point, Mr. Johnson recalled seeing that the stock had been transferred to a “street name” — meaning that a brokerage firm held the stock in its name — and the Bank of New York records show that the account address was changed to F.N. Wolf & Company, a successor company to Mayflower and First Jersey, run by a friend of both Mr. Mulvilhill and Mr. Brennan’s. F.N. Wolf ceased operating in December 1994 and filed for bankruptcy under regulatory scrutiny.

During the second half of 2012, before his death on Oct. 27, Mr. Mulvihill had a series of increasingly strange conversations with Mr. Miele about the Franklin stock, according to the complaint. On Aug. 21, Mr. Miele called Mr. Mulvihill on his cellphone, but Mr. Mulvihill told him he could not talk and that he was with Mr. Brennan. Three days later, Mr. Miele again called Mr. Mulvihill, who told him he was at the airport in Nantucket and couldn’t talk but was going to meet Mr. Johnson about the Franklin stock.

In mid-October, Mr. Mulvihill met with Mr. Miele and told him that because the mail related to Mr. Miele’s Franklin stock kept getting returned to Franklin — and Mr. Johnson had asked Mr. Mulvihill to take care of it — Mr. Mulvihill contacted John Steinbach, a business partner and the stepson of Abner Zwillman, known as the Al Capone of New Jersey. Mr. Mulvihill told Mr. Miele that Mr. Steinbach had “signed something” at Mr. Mulvihill’s request for Mr. Miele.

When Mr. Miele contacted Mr. Steinbach, according to the complaint, Mr. Steinbach admitted to “signing a document” in Mr. Miele’s name.

Mr. Mulvihill told Mr. Miele that if he “ever investigated this matter, Robert Brennan would hire a Russian hit man to kill [Miele III] and your family,” according the complaint. 

Ten days later, according to a Forbes story about the lawsuit, Mulvihill suffered a heart attack and died.

Now we should stress at this point that all this is what has been alleged in federal court.  The case hasn't gone to trial and the veracity of these allegations have not been tested in a courtroom.  To read the whole story in the New York Times, please go here:

http://dealbook.nytimes.com/2015/01/14/suit-accuses-franklin-resources-billionaire-of-defrauding-investors-heir/

You can also read the Forbes magazine story here:

http://www.forbes.com/sites/antoinegara/2015/01/14/mutual-fund-billionaire-charles-johnson-faces-lawsuit-over-millions-in-missing-stock/

The comments on both are worth reading.