From the Wall Street Journal: Apollo CEO Leon Black to Step Down Following Review of Jeffrey Epstein Ties
Leon Black plans to step down as chief executive of Apollo Global Management Inc. after an independent review revealed larger-than-expected payments to disgraced financier Jeffrey Epstein that it nevertheless deemed justified.
The months long review by Dechert LLP found no evidence that Mr. Black was involved in the criminal activities of the late Epstein, who was indicted in 2019 on federal sex-trafficking charges involving underage girls, according to a copy of the law firm’s report that was viewed by The Wall Street Journal.
In its report, Dechert found the fees that the billionaire had paid Epstein were for legitimate advice on trust- and estate-tax planning that proved to be of significant value to Mr. Black and his family. Mr. Black paid Epstein a total of $148 million, plus a $10 million donation to his charity—far more than was previously known.
(Featured image is “Did You Say ‘Bribe’?” by ccPixs.com and is licensed under CC BY 2.0)
Is $148 million a lot for Trust/Estate tax planning?Report
For a guy that plays at the level Black does, it might not be. Apollo has 312 billion in assets under management. I would give a wild-assed guess of 1 percent of that to be what Black has from that, which is 3 billion.
Pretty much any investment type stuff at that level is done on a percentage basis. 148 million is about 5 percent of 3 billion. That’s assuming that the amount involved was Blacks whole nut, which maybe isn’t the case, but maybe it is. So that seems a bit steep.
And yet, since the taxes on an estate that size are going to be maybe 1.5 billion, the right sort of maneuvering might be worth half a billion, and the 148 million is sort of 20 percentish of that, which isn’t crazy as a fee for some of these guys.
It does look bad. It is hard to explain to all your other investors, though it might ultimately be explainable. It’s just hard to say. I’m not willing to definitively say “there’s no way”. It looks especially bad if Black said things that made it seem a lot smaller, even though I can think of non-bribe-related reasons for him to say that.Report
$148 million is a lot to pay for estate and tax planning services from one guy, who is neither a lawyer nor a tax accountant. Generally speaking you might pay that kind of money to a financial services or law firm that has a team of experts working on your account and is actually executing these transactions. But for one guy’s advice, that strains credulity.
The deeper question is what makes someone hand over the whole, or even most, of their families’ net worth to one guy to manage, and not even a guy who’s attached to one of the big firms.Report
“The deeper question is what makes someone hand over the whole, or even most, of their families’ net worth to one guy to manage”
Well. Video of you banging a sixteen-year-old girl is a powerful incentive to play along.Report
NYT has a story on it.
One of the points in comments is that if you save someone 2 Billion, then giving them 7% ain’t a bad deal.
I’m pretty sure that the “P -> Q” statement is true.
I’m only now left with curiosity over whether P is true.Report
Lede Buried:
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