Bruce Caulk, who has a La Jolla home, is a movie producer/director in Hollywood. He has produced a potential blockbuster, but it needs a rewrite. The movie features high-priced stars, such as Mark Hamill and James Caan. Caulk would like to preserve the footage in any remake.
But if he only tinkers around the edges of the movie, savvy audiences will know they got cheated. The movie is Minkow, the story of Barry Minkow, who created a colossal Ponzi scheme while in his teens. He was sentenced to 25 years in prison. He got religion and got out after 7 years, and in 1997 he was named pastor of the San Diego Community Bible Church.
While serving as minister, he helped the Federal Bureau of Investigation and Securities and Exchange Commission smoke out scams. In 2001, he set up a company, Fraud Discovery Institute, to reveal smelly details of publicly held companies. He would bet that the stocks would go down when his report hit the wires. (This strategy was legal as long as he revealed his downward bet and the information was accurate.)
He became the national paragon of moral redemption — a reformed con man, now a minister, who went from pulling scams to exposing them. He was featured on 60 Minutes and Oprah Winfrey. He was regularly interviewed as a Ponzi scheme expert by Neil Cavuto of Fox News Channel. And the Wall Street Journal used him as a reliable scam source.
Initially, Minkow raised money from members of his church congregation to pay Caulk for the movie. Minkow insisted on playing himself in scenes in which he was middle-aged. The film was shown at the Berlin International Film Festival in early 2011 and was lined up to be shown at the iconic Cannes Film Festival in May of that year.
But while the film was being shot, Minkow had been making very strong charges — using phrases such as “Ponzi scheme” — about Lennar Corporation, the big real estate company. Lennar’s stock had tanked when the news broke. In the past, Minkow had been successful attacking smaller companies, and according to a detailed story in Fortune magazine, had gotten undisclosed payoffs from those firms.
But Lennar was having none of that and provided information to federal investigators.
In March of 2011, Minkow pleaded guilty to criminal insider trading charges in the Lennar adventure. So, here was a movie about a former con artist who had gone straight, becoming a church pastor and fraudbuster. But the hero was headed for five more years in prison. “We held [the movie] back. It was never intended to be distributed,” says Caulk.
“We had made a movie about Barry’s redemption,” says Caulk. He went to work raising money to make the script more closely fit the facts.
Then came further complications. In April of last year, Minkow was sentenced to another five years for embezzling $3 million from the church and its members. Some of the loot had gone to financing the movie. He admitted to stealing donations and skimming money off the top. He took out unauthorized loans in the church’s name. He conned $300,000 from a widow raising a grandchild. In one of his classic ploys, then-Reverend Minkow met in 2008 with a congregation member whose wife had died of cancer. Minkow suggested that the widower honor his late wife with a gift to build a hospital in Sudan. The money never arrived in that country.
Whither the movie? “Sometimes you pull the yarn on a sweater and the whole thing unravels,” allows Caulk. “We will have to integrate his repeated misbehaviors into the second act.” Possibly, he says, “There is a movie about the movie.” To include Minkow’s recidivism, he may have to lengthen the movie from an hour and a half to two hours.
Of course, says Caulk, “It is not a documentary. It is a theatrical narrative.” That will give him some latitude. “Probably a lot of that footage will be used. There are Hollywood tricks. We need some good writing.”
Personally, I wonder if he can patch this together and tell a story touching on the truth. Minkow had been fleecing the church and its congregation since 2001 — only four years after he took over.
San Diegans who dealt with Minkow believe he must be portrayed as a person who never experienced an ounce of atonement. William Newsome, a retired fraud prosecutor in the city attorney’s office, belonged to the church. Initially, he wanted to believe in Minkow. In 2001, he took him to lunch with Anthony Samson, a longtime fraud prosecutor with the district attorney’s office. After the three-hour session, Newsome asked Samson whether he believed Minkow had reformed. Said Samson, “He is still a con. He has found a new venue and context in which to perpetrate cons.”
Minkow attempted to do business with former Federal Bureau of Investigation agent Darwin Wisdom, now in private practice. “I met with him and wouldn’t do business with him,” says Wisdom.
Newsome told the board of elders at the church that Minkow should not be allowed to run Fraud Discovery Institute on the premises. It could jeopardize the church’s tax status. But the charismatic Minkow was filling the pews. The church had borrowed money to purchase audiovisual equipment, but Newsome couldn’t learn the terms of the loan. And “somebody who was sentenced to 25 years in prison should have nothing to do with church finances,” Newsome emphasized. But Minkow was given the chief executive reins over Newsome’s objections.
Several times, Newsome went into Minkow’s office and said, “Your website is continually pumping out false and misleading statements. You are putting yourself at risk.” Minkow paid no attention.
Newsome was excommunicated from the church. When he protested, the elders called the police, who showed up. Newsome left voluntarily.
He has the most credible explanation of Minkow’s psyche. “All Minkow wants is attention — as a villain or a hero. It doesn’t make a difference. He knows the difference between truth and falsehood; he doesn’t care.” When Minkow was sentenced to a second 5-year term, Newsome said the judge had been conned. Minkow “got 25 years for conning big banks, Wall Street, and accounting firms. Then he got only 5 years for conning unsophisticated parishioners. Recidivists should get longer sentences.”
Yes, Caulk needs a writer — one who will do a total rewrite. Minkow never achieved redemption.