This story first appeared in the May 2 issue of The Hollywood Reporter magazine.
“Leo DiCaprio is like my little brother,” says Dana Giacchetto, 51, sipping Viking Blod Mead honey wine during a $400 seven-course meal at midtown Manhattan’s Aquavit restaurant and hoping his next meal isn’t on Rikers Island. During the 1990s, Giacchetto (pronounced “jah-KET-toh“) was an investment adviser with an incredible list of celebrity clients that included DiCaprio, Tobey Maguire, Cameron Diaz, Ben Affleck, Michael Ovitz and Michael Stipe (also “like a brother to me,” he says). It all ended very badly. In 2000, he was nabbed at Newark Airport with a falsified passport and not long after pled guilty to fraud involving the misappropriation of between $5 million and $10 million of clients’ funds. He was sentenced to 57 months in prison.
Although the money involved might seem small today, in the pre-Madoff era it was a staggering scandal fueled by just the right mix of bold-faced names from Hollywood and Wall Street.
Giacchetto was released in 2003 and set about rebuilding his life. There have been setbacks and disappointments, including many strange new deals and a recent federal criminal complaint accusing him of fraudulently billing $10,045 to someone else’s credit card — allegations he denies — that could put him back in prison.
Yet tonight, in his first interview since 2003, he is delighted to have two THR reporters pick up the tab and join him on a three-day romp through New York City as he explains in great detail how supremely misunderstood he has been. The story is, well, like a movie — specifically, The Wolf of Wall Street, which he believes he inspired, as DiCaprio in the late ‘90s often stayed at Giacchetto’s SoHo loft, which Giacchetto says was awash in sex, drugs and punk rock. As he consumes a prodigious amount of alcohol, he rages, sobs, brags, cackles hysterically, confesses then denies guilt for the events that sent him to prison and otherwise exudes the exuberant charm that persuaded hundreds of intelligent, worldly people to trust him with their money.
Celebrities, executives and even former close friends including DiCaprio almost unanimously refused to comment on Giacchetto’s stories — “I need to be in this story like I need tooth decay,” says one. A few facts are uncontested: Born in Medford, Mass., 15 minutes from Horatio Alger‘s birthplace, Giacchetto was an Italian-American baker’s grandson whose mom told him, “It is impossible not to love you.” At 19, he got a job at Boston Safe Deposit & Trust and released a punk rock album while earning a bachelor’s degree from the University of Massachusetts. At 26, he founded Cassandra Group with about $200,000 from his mom’s Treasury bonds. Befriending Marc Glimcher, now president of New York’s Pace Gallery, he sold conservative blue-chip stocks to artsy blue bloods. Glimcher introduced him to then-skyrocketing CAA agent Jay Moloney, who hooked him up with Hollywood mogul Ovitz, manager Rick Yorn and pre-Titanic DiCaprio.
There were some legitimate deals along the way. In 1988, Joyce Linehan, a friend from Boston’s music scene, told him to call her pals at an underground Seattle record label called Sub Pop. Giacchetto cold-called Sub Pop’s chief financial officer Rich Jensen in 1991, when the label nearly was broke but on the brink of getting a small fortune because of Nirvana. In 1994, Giacchetto brokered the sale of 49 percent of the label to Warner Music Group for $20 million — many times its expected value. By 1998, Cassandra controlled $100 million in assets, and he formed a separate $100 million partnership with Chase Manhattan. Giacchetto forged alliances between high art and lowlife, music and movie stars. One of his big-name hires was a young lawyer named Chris Cuomo, now co-host of CNN’s New Day, as his head of compliance.
The celebrity he was most closely associated with was DiCaprio, who crashed for months in his vast penthouse loft in the Singer Building at Prince and Broadway. Giacchetto took the young star, 12 years his junior, on a tour of the New York Stock Exchange to “demystify the capital markets.” They frequently were photographed together at parties. Giacchetto cultivated a Svengali-like image. His presence was huge, though the scale of his business often was unclear. He now claims it was far greater than $100 million. “The truth is, I had a lot more, probably $5 billion,” he says. “I underexaggerated because I was terrified about the SEC — after $2 billion, they start to do audits.” How much did it cost to become a Cassandra client? “One million was the minimum [investment],” he says. “Unless you were super-cool.”
The assumption now is that DiCaprio’s experience with Giacchetto fueled his interest in doing The Wolf of Wall Street, though DiCaprio never has publicly said such a thing. Giacchetto claims to have heard what his old friend says on the subject. “People ask Leo, ‘Was [Wolf] about Dana Giacchetto?’ And he said, ‘No, not exactly,’ which is lovely,” says Giacchetto.
Giacchetto clearly likes the association with the hit movie but insists that he was not a fraud like Jordan Belfort, the disgraced broker on whom the movie is based. “I’m the Lamb of Wall Street,” says Giacchetto. “If I wasn’t dragged from an airplane at gunpoint, I would’ve been able to fix the positions. Whether [clients] lost money because the market went down or because I was a f—-up, I felt really bad about it. I never stole money in my life. Why would I do that to the people that I love?”
Nonetheless, Giacchetto says he loved the movie. “I lived it — not the stealing-money-from-poor-people part. Listen, the sex and the drugs and the decadence in my life was 10 times worse [than Wolf], a bacchanalian orgy for 10 years. There was sex constantly, there were drugs constantly, but there was no sex without condoms ever that I ever witnessed. There were certain rules, and that was one of those rules.”
Sources, though none for the record, confirm Giacchetto’s accounts of the parties. “There were lots of weird sex scenes,” says one prominent Giacchetto partygoer. The loft had $300 champagne, $5,000 hookers, top models, rockers, actors and artists. There also were two cockatoos, Angel and Tiberius — one each for Giacchetto and DiCaprio. Victoria Leacock Hoffman, a friend of Andy Warhol, Martin Scorsese and Giacchetto, attended a Christmas party at the loft and later threw Molly Ringwald‘s 30th birthday party there, both of which she says were fairly tame. “Leo was always sweet and gentlemanly,” she says.
Johnny Depp, Winona Ryder, Kate Moss, Michael Stipe and Mark Wahlberg sometimes were there, too, not that anyone says they did anything kinky.
“I had all my windows open, and John F. Kennedy Jr. was standing there,” says Giacchetto. “Everyone’s like, ‘Don’t fall out that f—in’ window!’ ” JFK Jr., as it happened, died in a plane crash en route to his cousin Rory’s wedding to Mark Bailey, who worked for Giacchetto’s business partner Jeffrey Sachs.
The night Titanic won 11 Oscars in 1998, DiCaprio skipped the ceremony; instead he and Giacchetto threw a party at the loft. “I was king of the world,” says Giacchetto. “We projected the Academy Awards on the wall and had every star come to New York to give the middle finger because we felt the Academy Awards were a complete f—ing sellout and anti-punk rock.”
Giacchetto says his relationships with many of his star clients went well beyond money. “I had a fight with [DiCaprio’s then-manager] Rick Yorn,” says Giacchetto. “He wanted Leonardo to make American Psycho,” as did DiCaprio. “I called [Leo’s dad], George, I called [Leo’s mom], Irmelin. I said, ‘Leo, if you do this movie, you must move out. Cutting people up? Is that what you’re about?’ Jay [Moloney, then in rehab] was like, ‘What the f— is Rick Yorn doing with Leo?’ ” (Yorn declined comment.) The part ultimately went to Christian Bale.
In 1999, Giacchetto hired Moloney, then struggling with drug addiction, as the president of his Paradise Music & Entertainment, a separate venture from Cassandra. The company never got off the ground, and Moloney’s mother told Vanity Fair that Giacchetto gave her son money from the former agent’s investment account, which she says Moloney then used for a drug binge that ultimately ended in his November 1999 suicide. “I killed him? It was his money,” objects Giacchetto, breaking into what appear to be genuine tears. “If I didn’t give it to him, I would’ve gone to jail. I went to rehab with him [in New York], and then Uma [Thurman] and I, every week we’re flying to [his rehab] in Minneapolis, praying at his bed — ‘Please, Jay, what is wrong? I need you.’ ”
Giacchetto says Ovitz needed him when Ovitz founded Artists Management Group in 1998 with Yorn and took on such clients as DiCaprio and Diaz from CAA, the agency Ovitz once ruled with an iron fist. “I used to have these peace meetings: ‘C’mon, guys, AMG can be the management company; CAA can be the agency. You don’t have to fight.’ ” A CAA source claims not to recall such meetings. Continues Giacchetto: “I was, you gotta remember, an outsider. I was from New York; I wasn’t really an L.A. guy. It’s almost as if they did a palace coup and turned against [Ovitz] and blamed me for it. I lost all my clients, but I can’t say bad things about Michael. He didn’t play dirty pool. And when he says I was his spiritual adviser, I was. And he was mine.”
“I would sit on [noted art collector Ovitz’s] plane, and we would talk about pure abstraction,” adds Giacchetto, who claims to have given a Basquiat painting to DiCaprio, “whether Serra is more important than Judd, whether [Rauschenberg’s] white paintings were more important than Motherwell or whether impressionism is shit. Ovitz was one of the very few intellectuals in Hollywood. Most of those people are f—in’ frauds.” (Ovitz declined to comment.)
Ovitz’s power flowed through Giacchetto. “My performance for so many years was so good and quantitative — not bullshit, not boiler room, really good — that I started to get the Ovitzes of the world and the very, very serious heavy-hitter asset managers to say, ‘This guy actually f—ing knows how to trade. He has a gift. He may be a flake, he may be effeminate, but he knows what he’s f—ing doing.’ I’m some crazy mathematical rock-star wacko who sold Sub Pop and Matador and made a lot of money.”
Giacchetto says his greatest deal was the 1994 Sub Pop sale to Warner. “I can now reveal that Universal was the top bidder, $25 million,” says Giacchetto, “but it wasn’t the right creative fit. Sony Music bid $5 million. David Geffen bid $8 million — I told him his bid was way too f—ing low — and Microsoft bid a paltry $4 million, frankly insulting. Bill Gates, who at the time considered himself to be ‘the future of entertainment,’ couldn’t have been a more dull character. It definitely would have made Microsoft a bit more hip, which in hindsight might have actually made Microsoft a player in entertainment. They’re still not.”
Microsoft refuses to comment on whether it ever had any interest in buying a small record label. But Sub Pop founder Bruce Pavitt and Rich Jensen, two of the few former Giacchetto associates willing to speak on the record, confirm Giacchetto’s account and give him credit for the deal. “Dana was a charming charlatan and a persuasive method actor who never deviated from character,” says Pavitt, who cleared $4 million on the sale. “He did pull off a brilliant deal with Time Warner, indeed allowing us to keep 51 percent of the company.”
With his loft parties and extravagant trips with clients (to Cuba and Thailand with DiCaprio; on a $50,000-a-person Colorado whitewater raft trip for the Environmental Defense Fund), Giacchetto says, “I was trying to create a salon.” But when he partnered with venture capitalists Jeffrey Sachs and Sam Holdsworth in the $100 million Cassandra-Chase Entertainment fund, he discovered a corporate culture that was intolerant of his punk-rock record-keeping style and high operating expenses. “It ruined everything,” he says. “All of a sudden, it wasn’t about all the genius cool people that I wanted to put together to meet each other — artists, directors, writers, filmmakers, gay, straight, whatever.”
The new venture was not to his liking for other reasons, too. Despite his flashy lifestyle, Giacchetto had been a relatively conservative investor — a punk who worshipped Warren Buffett. He had the opportunity to get in early on his old roommate Craig Kanarick‘s Internet startup Razorfish, which would have made him a killing, but Giacchetto distrusted tech. “I never veered from that until big Chase came knocking at my door and said, ‘Wow, you’re pretty impressive.’ It’s Faustian, right? I was drinking and doing drugs, so I think my head was compromised. I was working 18-, 20-hour days all over the world. I never had a pyramid scheme or a Ponzi scheme. I just flew too close to the sun and spun out of control.”
Giacchetto’s fall from grace began when his investments performed poorly during the late 1990s, and instead of breaking bad news to his famous pals, he tried to cover up his losses, using client money to replenish other clients’ accounts and pay company and personal expenses. When he was arrested April 12, 2000, he was carrying $4,000, mostly in fives and tens, and 80 first-class tickets.
Naturally, when his legal troubles began, his celebrity friendships ended. Officially, anyway. Giacchetto claims that many still have warm feelings toward him but are afraid to express them publicly. “Here’s what’s changed post-prison: Everyone is still lovey-kissy with me, but they’re scared to death. When I go to Hollywood and see all my old clients, which I do, it’s always off the record. Even the people that I loved the most, they would answer the phone like, ‘I’m afraid to see you,’ because Hollywood is so small. Leo, I mean, we only talked through lawyers through the years because we’re afraid.”
After prison, Giacchetto went to work briefly as an editorial hand for Jane Pratt‘s Jane magazine and for his attorney, Ronald Fischetti. “I made a deal with the SEC that I cannot be an asset manager, but I can do all kinds of other things,” says Giacchetto. “I do deals, I’ve bought and sold companies legally.” He shows off a $3.5 million contract for the sale of the Tribeca digital firm Syrup to LBI International, a marketing and tech agency. He has spent years raising money for his gourmet food business, Taste — “I do like super-crazy exotic things in cans, everything from caviar to a whole lobster. We’re doing [a deal with] Singapore Air this month.” — and raves about his forthcoming product, IncrEdible, a food cleanser. “You can spray it on raw meat or fish or counter surfaces — it’s the first, twice-U.S.-patented cleaner that you can actually eat. It’s incredible. It’s edible.” He’s hawking a screenplay of his dad Cosmo’s novel When the Act Accuses Him — “sexy, political drama infused with dark comedy, James Joyce meets Don DeLillo,” he says. Cosmo made his own small fortune in real estate and once threw a party for Rocky Marciano. “My parents give me money right now. And I have access to vast wealth.”
Recently, he invested $300,000 in a Las Vegas show called Stripped, starring Steve Stanulis, the ex-cop stripper who worked as a bouncer at Giacchetto’s parties. “[The now closed show] was a disaster,” says Giacchetto. The credit card allegations, brought by federal prosecutors in New York, are somehow mixed up with the Stripped project. “There were all these people involved, flying around,” says Giacchetto. “I’m not sure who paid for what. It’s f—in’ laughable, right? I don’t even know what it is. I charged a bottle of wine?” (The complaint describes other allegedly fraudulent charges, including work by Giacchetto’s dentist.)
Giacchetto says he has found happiness as the father of two children, ages 6 and 8, though he adds that their mother, Allegra Brosco, a former assistant to independent producer Ted Hope, recently left him. “She said: ‘I don’t want to live this life, Dana. I can’t live this life of being in the public.’ ” He’s vague about where he currently lives, although he claims it is in Manhattan near David Bowie and Courtney Love. He alludes to a warm relationship with heiress and couture collector Daphne Guinness, whom Lady Gaga calls “a huge source of inspiration for me.” Guinness gets rave reviews for singing the drug tune “White Rabbit” with Giacchetto’s band Element 4. (Multiple sources say the two are just friends.)
Our three days are punctuated by moments of reflection and even candor. “I’m not in denial,” says Giacchetto, who was required to pay restitution to his victims, although it is unclear how much he actually has paid. “I know a lot of f—in’ people got hurt from what I did. I said I’m sorry to everyone personally, one-on-one. Everyone forgave me.”
Actually, several investors told THR they don’t forgive him. “And there was definitely no phone call of apology from Dana,” notes the representative of one prominent former client. Hoffman, who lost half of the $220,000 she got from developing the musical Rent to Giacchetto’s investments, puts it bluntly, “Dana is an asshole.”
Giacchetto professes to be flummoxed by his punishments and banishments, given how those he deems the true wolves of Wall Street have prospered. “If you look at the demons of 2008,” he says over beef tartare at the SoHo brasserie Lafayette, “in terms of who went to jail, there were very few people that were in big banks. It was absolutely malfeasance everywhere … which makes it remarkable that I’m being prosecuted for this thing now. It’s crazy. Like, why? Why me? And Madoff, he has nothing to do with me because Madoff was a thug, a thief and a monster. I never planned to steal people’s money. I got in over my head on deals that lost money. But I never stole.”
At his 2001 sentencing hearing, Giacchetto tearfully told the judge, “I lived [in] a world of fantasy.” At Lafayette, just a few blocks from the penthouse loft where he and DiCaprio partied and kept their matching set of cockatoos, he gets a faraway look and murmurs, “In a lot of ways I still live that way. Only because I believe in my dreams.”