Americans See Boesky Case As Lesson In Greed With AM-Boesky Bjt
Undated (AP) _ From Southern California to the Iowa farm belt to Wall Street, Americans are interpreting the rise and fall of stock speculator Ivan F. Boesky as a lesson in greed.
Boesky was sentenced Friday to three years in prison for his role in the biggest stock trading scandal in the nation’s history. Aside from his earlier agreement to pay a record $100 million in civil penalties and disgorged profits, the 50-year-old Boesky was not fined.
Opinions gathered by The Associated Press in random interviews around the country uncovered a wide range of reactions. Some felt the punishment was adequate; others viewed it as a slap on the wrist. A few couldn’t care less.
″Three years? Is that all?″ asked Loretta Wooldridge, a state employee in Frankfort, Ky.
″I think it’s enough, just to let some of those people know they are going to go to prison,″ countered William P. Kotteman, an orthodontist in Iowa City, Iowa.
″I guess it’s wrong that he used his position to further his own means,″ said Michelle Peterson, a Boise, Idaho, housewife. ″But I don’t know if he should have gotten more or not. I don’t really care.″
Ms. Peterson was among a handful of people who had never heard of Boesky before being asked to comment.
Some doubted Boesky’s sentence was harsh enough to deter corruption on Wall Street.
″The stock market turns me off when I see this,″ huffed Norm Havel, who operates Farmers Elevator Co. in Bondurant, Iowa. ″He’s got three years. Heck, he’ll probably serve half of that if we’re lucky.″
Boesky allegedly made hundreds of millions of dollars on stock deals aided by illegal inside information. He claims he is nearly broke now and faces civil lawsuits from investors seeking more than $1 billion.
″Coming on the heels of the stock market crash, I think a lot of people are going to learn a double lesson,″ said Richard M. Stein, a consulting economist in Glendale, Calif. ″Crime doesn’t pay, and the market is a mechanism for taking care of imbalances in the economy and there’s no way you’re going to beat it.″
Still, Stein said he did not think Boesky’s fall would significantly affect the operation of the securities business.
″People may have cleaned up their own acts, but I don’t think the SEC is going to go in and change the rules much.″
Others were more optimistic about the prospects for reform.
″If he had been allowed to get off scot-free, it definitely would have sent the wrong signal,″ said John Alan Phillips, president of the North Country Savings Bank in Ogdensburg, N.Y.
″It’s just the tip of the iceberg. It’s the beginning of a harsher reality for white-collar criminals,″ said Jim DeGennaro of Bartow, Fla., an industrial recruiter for the Polk County government.
″I’m hopeful we’ll do a lot more to beef up security in this industry,″ said Gil Schroeder, a stock broker at the Seattle office of Smith Barney, Harris Upham & Co. ″I think there’s enough concern among professionals to see that this is not dropped.″
But James Swofford, a medical clinic administrator in Mount Vernon, Ill., believes the small investor is still at the mercy of market wizards like Boesky, despite the investigation.
″It really has made me lose confidence in the whole system,″ he said. ″Even after the October decline, it just looks like it’s all being manipulated by the ’big boys.‴
On Wall Street, where workers are still stunned by the double-barreled shot of a major scandal and a market plunge in 1987, comment was guarded.
″Unfortunately, the people really affected - the small-time investor - won’t benefit,″ said Jesse Davis, 28, who writes computer trading programs. ″There are victims out there still and they probably don’t even realize it. The market works on faith and he took that away.″