Den of Thieves

Product Details

A number-one bestseller from coast to coast, Den of Thieves tells, in masterfully reported detail, the full story of the insider-trading scandal that nearly destroyed Wall Street, the men who pulled it off, and the chase that finally brought them to justice. Pulitzer Prize winner James B. Stewart shows for the first time how four of the biggest names on Wall Street -- Michael Milken, Ivan Boesky, Martin Siegel, and Dennis Levine -- created the greatest insider-trading ring in financial history and almost walked away with billions, until a team of downtrodden detectives triumphed over some of America's most expensive lawyers to bring this powerful quartet to justice.

Based on secret grand jury transcripts, interviews, and actual trading records, and containing explosive new revelations about Michael Milken and Ivan Boesky written especially for this paperback edition, Den of Thieves weaves all the facts into an unforgettable narrative -- a portrait of human nature, big business, and crime of unparalleled proportions.

Product Reviews

(2 stars) - Not a very truthful protrayal of Milken
I just reread this book now that I have 14-more years of financial world experience. I enjoyed the first half which primarily deals with the financiers and their transactions, but the second half gets bogged down following the regulators who seem hell-bent on making big arrests of powerful people and advancing their fame and careers more than they care for the actual rule of law.

Most of the financiers introduced are truly repugnant characters, in particular guys like Dennis Levine, Marty Siegel, and Richard Freeman. Levine comes across as a conniving weasel who was basically inept at arbitrage and was able to hide this fact from the ignorant (not everyone) by cheating. Siegel was portrayed as a smug crook who turned crybaby as soon as he had to take his medicine. I can't decide if I disliked Levine or Siegel more. Freeman is the most interesting. He seems clearly guilty of insider trading, and pretty much escaped severe prosecution thanks to his benefactors (Robert Rubin) at Goldman Sachs, along with most of his personal wealth.

While Stewart does some exceptional research, it is also clear that he is engaging in a lot of speculation. The most obvious example is the numerous recounted conversations between all the characters, which is of questionable accuracy and few of which are verifiable beyond what the author was able to extract from a large group of people whose honesty is suspect. This includes all the attorneys, corporate chieftains, and in my opinion it especially includes all the government agents and prosecutors.

There is a lot of myth surrounding Milken, and unfortunately most of it is inaccurate. For one, Milken has always been very guarded of his privacy. Its easy to assume he is this way because he has something to hide, which is a poor argument many people love to put forward these days. For the most part Milken has shunned interviews and has made a best effort to not get involved with the press.

Most of his closest associates remained loyal to him, and he was essentially fingered by the lying criminal Boesky for an accounting irregularity involving $5.3 million in commissions, which is hardly a master-mind criminal gain considering the multitrillion dollar scope of Drexel's operation. By fingering Milken Boesky, who clearly was guilty of insider trading, got off with a mere 3-year sentence and was able to retain some $25+ million at the expense of the people he hurt. To support Boesky's claim, agents entered the home of a young female employee and basically got her to admit guilt through coercion (fear) for something she probably did not actually understand. Unlike Boesky, Milken was never convicted of insider trading, nor was there any clear evidence that he had engaged in it. In fact, Judge Kimba Wood conceded that 4 out of the 5 convictions had zero negative economic impact, however Stewart clearly allows his personal opinions to vilify Milken and paint him out as some genius criminal. So in hindsight, the sum negative economic impact of what Milken was charged for was actually less than $320,000. Considering his operation was trading roughly $1 billion per day, there is clearly an unfair bias present throughout the book.

Milken is arguably the most brilliant financier of our age, and having financed some 3,200 companies, it is unlikely anyone will outperform him anytime soon (if ever). He was largely responsible for economic improvement in the US in the 1980's. He has always been a strong proponent of sound capital structures and responsible use of leverage. Companies that were suffering from inept managers were easy targets for takeover and restructures using Drexel financing. Beyond just junk bonds, Milken employed a vast range of financing methods that provided essential capital, which allowed companies to grow, hire, and prosper. Once it became evident that the Milken tap was shutting down (1987-1991), the market responded negatively as would be expected.

There was much to be gained from Milken's downfall. Drexel's success certainly created a lot of ill will among the old and established Wall Street banks. Since Drexel via Milken was the dominant financier, the destruction of Drexel and the ruin of Milken sent their multibillion dollar financing into the hands of the very competitors who clearly stood to gain. Stewart conveniently ignores this whole side of the equation, which is not fair. It is a good example of the many biases that plague this book. Then we also have the likes of Rudy Giuliani behind the prosecution, and here Stewart tries to argue that Giuliani had such noble intentions and cared so much about the rule of law as opposed to his making a big name for himself and advancing his public career (all this just before he successfully ran for NYC Mayor).

If you are really interested in Milken, the book is worth reading so long as you understand that a lot of the information that is presented as hard and irrefutable fact is actually rather questionable, especially in hindsight. Reading the book for the second time, it felt dated and given that it was released fairly shortly after all the events concluded, is clearly guilty of hype and sensationalism.

(5 stars) - Brilliant
Great book on the insider trading scandal and its leading characters. The parallels to the current insider trading scandal are clear, as is the corruption sneaking in on otherwise decent and intelligent people ("relax, everybody does it"). Very interesting description of the political process leading to Milken's deal with the state prosecutors office. Very well written.

(4 stars) - How money driven values affect personal integrity
I first read this book after starting my job at the Securities and Exchange Commission in the 90s along with 2 other books "Liars Poker" by Michael Lewis and "The Predators Ball" by Connie Bruck. These gave a sober inside look at how white collar crime takes place when you think no one is watching. I was impressed by James Stewart's reporting of the case, how different people in the story were introduced into the insider trading schemes as well as how difficult it is to make a case for the prosecutors when it comes to these crimes. Additionally I'd recommend these books as a means of introduction to how the stock market works ... it is told in story format so it's easy to understand.

Seeing it from the law enforcement side gave me a tremendous appreciation for how hard the investigators work. It is a wakeup call to those who make their money in securities and believe these are victimless acts when you trade on inside information.

(5 stars) - SUPERB!
This is not the kind of book I usually enjoy as I get quite bored with anything to do with the world of finance. Having found this free book and liking the title, I took it home and since I didn't have anything better to read I began this book and I have to say that almost immediately I was captivated. I had discovered that with the right approach, even the stock market and its mysteries began to unfold for me due to the expert guidance of James B. Stewart. I therefore highly recommend this book, particularly if you are a Wall Street "virgin" like me.

(5 stars) - a great read
Back in the '80s I read James Stewart's Wall Street Journal articles on the insider trading scandals. Now, in 2009, I finally picked up his book on the subject, and I found that it's every bit as fascinating, and every bit as relevant, as it was when the scandal first broke. This is the story of Michael Milken, Ivan Boesky and the other crooks who believed that "greed is good" and the SEC is for sissies. In the age of Madoff, mortgage-backed securities, and other financial frauds and schemes, the book is a good reminder that there's nothing new under the sun.

I recommend this book for anyone interested in financial fraud. That really ought to be just about everyone.

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