Barry Minkow

Barry Minkow (born March 17, 1967) was an American teenage entrepreneur who managed to present the front of a successful businessman for a number of years during the 1980s. He was convicted of fraud and became a prison inmate for over 7 years subsequent to his misdeeds. During his time in prison Minkow became involved in Christian ministry, which continued upon his probationary release from prison in April, 1995. Today he is senior pastor of a San Diego, California church, having renounced and forsaken his previous misdeeds. Minkow is also a recognized fraud expert, and speaks on the subject to university students and the business community in an effort to prevent fraud.

Beginnings of Zzzz Best

Raised in a culturally Jewish family inside a modest Reseda house within the San Fernando Valley of Los Angeles, Minkow learned his business manners from his mother's job as a telemarketer. At the age of 15 while a high school sophomore he started his own carpet cleaning company, Zzzz Best, in his parents' garage in Reseda. From its humble beginnings in home carpet cleaning by a few employees, in four years it had 1,400 employees and had begun to specialize in insurance restoration business. His frequent television commercials in the Los Angeles market during 1986-7 featured the then young entrepreneur in business suit with tie, confidently extolling the superiority of Zzzz Best.

Related Topics:
Jewish - Reseda - San Fernando Valley - Los Angeles

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Minkow worked hard to form dozens of business contacts. His most important contact was Tom Padgett of Interstate Appraisal Services, an insurance claims adjuster who could get large restoration contracts. He was presented as a business success story in magazines and TV shows. Mayor of Los Angeles Tom Bradley declared a Barry Minkow Day. He lectured in business schools and contributed to Narcotics Anonymous. He had a Ferrari Testarossa and a mansion in Woodland Hills. Zzzz Best' stock raised to $18 (USD) a share on Wall Street for a total of more than $280 million (USD).

Related Topics:
Insurance - Claims adjuster - Los Angeles - Tom Bradley - Narcotics Anonymous - Ferrari Testarossa - Woodland Hills

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However, behind the scenes his company was nothing more than a front to attract investment for a Ponzi scheme. Zzzz Best did not clean anywhere near as many carpets as claimed but generated a plausible paper trail to fool potential investors. Interstate Appraisal Services was formed as a separate company to support this fraud. Minkow raised money by factoring his accounts receivable for work under contract. One of the first contracts he received was from the Genovese Mafia family. He hired reputable accountants and lawyers to boost his image. Later, upon indictment, he claimed that he had intended to form a legitimate business empire and pay back everything, nobody being the wiser.

Related Topics:
Ponzi scheme - Factor - Accounts receivable - Genovese - Mafia - Accountant - Lawyer

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