Big homes, cool cars, reality TV stars — the oil traders saga continues

A 1957 Cadillac once owned by Frank Sinatra.

11 Mercedes Benzes.

A lakeside home with dual boat launches in upstate New York.

A house, a Bentley and diamond jewelry for a Houston socialite-turned-reality TV star.

These are just a few of the items prosecutors say were purchased by at least one of a trio of jailed oil traders accused of taking part in a scheme to defraud a major refiner out of tens of millions of dollars.

Prosecutors unsealed a 12-count indictment against the men, Jonathan Barnes and Clyde Meltzer, of Houston, and Bernard Langley of the United Kingdom. As we first reported and expanded on in December, the indictment alleged the men charged refiner LyondellBassell above-market shipping fees for oil coming from Venezuela, kicking back a portion of the excess funds to Barnes, who worked as a logistics specialist for Lyondell.

The men allegedly used the estimated $55 million they gained from the scheme to buy homes, cars, jewelery and other items for themselves, friends and family.

The indictment unsealed today has a laundry list of items, most of them purchased by Barnes, including a 1957 Cadillac Brougham that Frank Sinatra once owned. The documents can be found here.

When built, the car was more expensive than a contemporary Rolls-Royce. It was among the first cars with six-way power seats, power door locks, an automatic trunk and Autotronic Eye headlight dimmers. It also had a number of over-the-top features. These included magnetic-bottomed stainless-steel drink tumblers in the glove box, a complete lady’s makeup compact, a cigarette case and an atomizer filled with the French perfume Arpege Extrait de Lanvin.

Barnes also purchased a $750,000 home in the Wynden Oaks neighborhood north of the Galleria for self-described socialite Leslie Tyler Fink and her husband, Randy, as well as a Bentley and a number of pieces of jewelry, according to the filings.

Fink, who has her own line of cosmetics and blogs for Houston-based website www.RSVPSocial.com, may be part of an new reality TV show. In her blog she has mentioned the Bentley and jewelry provided by Barnes before (the postings seem to have been taken down but The Houston Press included them in a scathing piece last year).

Dan Cogdell, an attorney for Fink, said she has cooperated completely with investigators and returned any property that has been requested.

“Leslie never suspected that Mr. Barnes was engaged in any criminal wrong doing, nor did she have reason to,” Cogdell said.

Other Barnes assets that have either been seized or are the target of forfeiture:

  • A 5,350-square-foot home on the shores of Canandaigua Lake in Naples, N.Y., worth $2.3 million, as well as a nearby $500,000 piece of property.
  • Barnes’ 5,400-square-foot home in Bellaire, Texas, purchased in 2007 for about $773,000 but valued at $992,000 according to county records.
  • A Mercedes McLaren, a limited edition coupe that costs about $500,000
  • 10 other Mercedes
  • A Cobalt boat
  • Two Sea Doo Jet Skis
  • More than a dozen pieces of jewelry from DeBeers, Zadok Jewelers and Valobra, including a silver and diamond Cartier watch
  • Nearly $8.5 million in funds from various bank accounts.

Agents also filed forfeiture papers against property they allege Meltzer purchased with proceeds from the scheme. They include:

  • A Bellaire home in the name of Ian Meltzer, Clyde’s son. This is not the Bellaire home listed as his homestead, however.
  • A Del Ray Beach, Fla. home purchased in the name of Clyde Meltzer’s wife, Karen Rose Meltzer, valued at about $3,295,000
  • Three 2009 Cadillac Escalades
  • A 1991 Chevy Camero
  • A 1961 Chevy Impala
  • A 1960 Chevy Corvette
  • Nearly $2 million in jewelry from Zadok’s
  • An investment stake in 360 Sports Lounge on Washington Ave.

The forfeiture filings do not mean the government has taken possession of them. Rather it ensures that the properties cannot be sold without the government’s consent.

It appears at least four other individuals face charges related to the alleged scheme. The superseding indictment has blacked out their names.

32 Comments

  1. rat618

    Yep all those high prices at the pump are Obama’s fault.

    #1
  2. So what ! Our politicans and speculators do it everyday !

    #2
  3. Indianpaintbrush

    “When built the car was more expensive a contemporary Rolls-Royce”
    ———————-
    Proofreading is a dying art.

    #3
  4. Indianpaintbrush

    “Barnes also purchased a $750,000 home in the Wynden Oaks neighborhood north of the Galleria for self-described socialite Leslie Tyler Fink and her husband, Randy, as well as a Bentley and a number of pieces of jewelry, according to the filings.”
    ———————–
    One has to wonder about Randy. Maybe it’s just me, but if some other man was furnishing me with a house, a Bentley, and jewelry, my husband would have quite a bit to say …..

    #4
  5. cloudwaltzer

    All true!!!

    #5
  6. Zilch

    From the looks of oil prices they didn’t catch them all.

    #6
  7. Princess

    Ummmmm OK..somebody not your spouse buys you a $750,000 house and you NEVER ask where the money came from ? Where can I meet these men…?

    #7
  8. Raven

    It kind of makes me and others who actually make an honest living, despite how undercut the pay is (lol) that the white collar criminals get away with so much S%&@ for so long before someone in the federal government cares enough to do something about it. As for the high prices at the pump being Obama’s fault, rat618…Really? FYI, last time that I checked, OPEC are the ones responsible for charging retarded prices per barrel in addition to the independent gas stations setting their own and often outrageous prices. Now I could be wrong but the current President of the USA has no ties with the petroleum industry…which is more than I can say for the last one and his daddy, HEH (^_^)!

    #8
  9. Raven

    I agree with you completely on all points, Indianpaintbrush (^_^)!

    #9
  10. Jillian Cohan

    Thanks for spotting the dropped word, Indianpaintbrush. We’ve fixed the error.

    #10
  11. Indianpaintbrush

    A comma after “built”, would be good , too.

    #11
  12. Big Pappy

    I in no way condone what these guys did, but they are pure morons. A simple $12,000 to $15,000 extra per month would have been lost to rounding errors on Lyondells books. They could have done it for YEARS, and no one would have known. You had guys working both sides of the deal. Unless one turned on the other, or ran their mouths, it was “…Party on Wayne, Party on Garth….”

    And folks want to blame the Oil Companies for price swings…… These jack legs (traders) are the bane of oil price swings. They make money when the markets go up or down, they don’t care. They make money off “THE DEAL”, period.

    Pappy

    #12
  13. bob

    I seem confused – how is this different that lobbyists contributions to campaign funds?

    #13
  14. phantom

    Greed gone wild! … looks like they are waking up to a hang over.

    #14
  15. Jackalope

    Barnes was a “logistics specialist”. Surely someone at his workplace noticed the cars, homes, vacations, etc. You don’t buy 1 of those things doing the day job he did.

    #15
  16. KB

    Between the feds and trade scammers, oil ompanies don’t have a chance.

    hey rat618…that hasn’t hit yet, but it will.

    #16
  17. lowe

    We want less government, govt is evil, get off our backs, free enterprise !

    #17
  18. Robert Paulson

    Sounds like the spirit of Enron continues.

    #18
  19. Marbleann

    People want to know how the wife had no idea how her hubby got 750,000 to pay for a house. Well that is the reason they marry women like her. They never ask questions. I know people who do not even know what their husbands do for a living.

    #19
  20. JJFlash

    “A man with a briefcase can steal more money than any man with a gun.” Don Henley’s words to live by.

    #20
  21. pervleft

    Rather it ensures that the properties cannot be sold “with? the government’s consent.

    #21
  22. David

    rat618
    January 21, 2011, 2:02 PM
    Yep all those high prices at the pump are Obama’s fault.
    ***********
    Yep, just as much as they were Bush’s fault before him. Now when the price goes waaaaay up in about 2 -3 years, it will be Obama’s fault, because the production that would have been coming on-line from the Gulf of Mexico won’t be there since he banned deepwater drilling and had his feds slow walk all permits.

    #22
  23. You_Annoy_Me

    When are our politicians going to do something to change the way Wall Street Screws us?

    #23
  24. West U Coog

    Did anyone at Lyondell wonder how an employee like that could afford all those things? Crazy!

    #24
  25. stevedhu

    Years ago my next-door neighbor worked for Lyondell as a logistics specialist and was laid off within days of Lyondell being bought out by a German company. I will guarantee you she didn’t make anywhere near enough money to come close to what this jerk owned.

    #25
  26. Lori

    Well, now we know what Amanda and Leslie were fighting over. :)

    #26
  27. Dollar

    This was a kickback scheme that could occur in any industry or govt in the world. I fail to see the connection with the price of oil on the NYMEX.

    Maybe some of you geniuses can clue me in ? You seem to have all the immediate answers.

    #27
  28. Big Pappy

    Good question Dollar. These two half wits did not have direct influence on the NYMEX, but traders in general can. These guys (traders) have literally hundreds of millions of dollars at their beck and call. It doesen’t take a whole lot to start a “move” in the price either way. Understand that traders can and do make money with prices going up or down, they DON’T care. They simply play the emotions/sentiment of what is happening in the world. I can’t find the source off hand, but read where over 65+% of ALL oil contracts are NOT held to delivery. In other words, they (contracts) are bought or sold before physical delivery has to take place. There are only so many entities with the physical ability to take delivery, so look how much the market is “played” by those who could NEVER accommodate a physical delivery of a single contract.

    Pappy

    #28
  29. Dollar

    Yes, there are two classes of traders defined by the CFTC, physical traders and speculators. They trade by different rules.

    But you must have the speculators, because there are not enough physical traders. If there were only physical traders, the market would be much easier to manipulate. Also , the volume provided by speculators adds to price discovery. All they are doing is adding another opinion to the pile.

    I see nothing wrong with speculator class trader, who do not take delivery. They are merely investors.

    The only problem I see with commodity trading in total, is the advent of the ETF, the Exchange Traded Fund. This is bringing far more money into the market, and the way these funds roll over contracts on settlement day changes the nature of the investment to an equity class, rather than the role of providing a hedging vehicle for producers.

    And characters like these guys who are in this kick back scheme, are not typical speculators. UTIMCO is a speculator, last I looked , they had 8% of UT and A&M’s endowment fund invested in commodities.

    As far as playing on emotion or sentiment, well that’s only a problem if emotion or sentiment say the price of oil is going up. But really, if that actually drives the market, its only on a daily or temporary basis. And it can create short positions as well as long positions.

    I don’t see a problem with volume, the problem is that all this money wants to take long positions. So in other words, the real question is why do investors want to own oil ? And why do they think the price of oil will rise ?

    If Obama closes off the GOM to drilling, refuses to open the eastern seaboard, shuts down the Arctic ………. and all the while, GreenPeace is using the courts in England to bring a halt to drilling in the North Sea, then it does not take a genius to realize that supply will be restricted and the price is going up ( or OPEC is going to become stronger players than ever ) . And speculators ( or investors ) place their bets accordingly.

    I see no problem with that.

    And yes, there are always somebody trying to game the system. Sometimes they are successful, but the market has its own way of working out these excesses.

    #29
  30. Houston

    Tell Stanford Hello…That is some high dollar kitty…Fink, what a Snob. ..You can buy style, but you can’t buy class…You can take the girl out of, but you can’t take the …out of the girl.. Randy finally buy some balls.

    #30
  31. Houston

    self-described socialite….You nailed it!!! LMAO

    #31
  32. ed65

    Wonder if they can adopt me.

    #32