Wall St.’s Soldier of Fortune

Wall St.’s Soldier of Fortune – Kevin Ingram

Leah Nathans Spiro

He was a high-flying trader with a taste for flashy cars, pretty women, and fast cash. But when Kevin Ingram turned his WorldTrade Center office into a money laundromat for alleged arms dealers, not even his powerful friends could save him–especially after the name Osama bin Laden came out in the wash.

HAVE YOU EVER SUFFERED FROM A MENTAL ILLESS?” asked Judge Donald Middlebrooks in his Orlandobred drawl.

Kevin Ingram, 42, late of Goldman Sachs and Deutsche Bank, Porsche-driving playboy, disgraced master of the universe, stood in front of Middlebrooks, his hands clasped before him, his broad shoulders slumped inside his double-breasted pinstripes.

“I suffered from depression,” Ingram replied. For a few seconds silence suffused the small West Palm Beach courtroom. “Mostly after this incident ensued,” Ingram explained to the court. Ingram admitted that he had been seeing a counselor and that he was now taking medication.

August 28, 2001, was a particularly sweltering day in West Palm, but inside the courtroom Ingram seemed remarkably cool as he pleaded guilty to one count of conspiring to launder S350,000 and publicly declared himself a felon. Behind Ingram sat his wife Deann, a statuesque beauty who took in the proceedings from behind a pair of two-tone sunglasses. Her prim black suit and gilded stilettos rendered her a glamorous anomaly in these dispiriting surroundings.

Ingram’s ordeal had begun three months earlier, when federal agents stormed a Fort Lauderdale hotel room after a 31-month sting operation and arrested Ingram and Walter Kapij–an airplane broker who had allegedly chartered a Learjet to help Ingram fly $2.2 million to Holland (Kapij has pleaded not guilty). After Ingram was released on bail, magistrate judge Ann Vitunac was tipped off to $1.6 million Ingram had secreted in a Swiss bank account. Fearing he would jump bail, Vitunac remanded him to jail. On August 6 Ingram appeared before Vitunac in handcuffs and leg irons. Satisfied that he wasn’t biding any other assets, Vitunac released him.

The arrest of Ingram, a protege of former U.S. Treasury secretary Robert Rubin and one of the financial world’s rising stars, has global implications that go far beyond Wall Street. Prosecutors claimed that Ingram knowingly conspired to launder $2.5 million in funds from two alleged arms dealers: an Egyptian-born commodities broker named Diaa Mohsen and Mohammed Malik, a Pakistani native who owns a small grocery store in Jersey City New Jersey. At one point, in 1999, the government was so concerned that Mohsen was trying to buy arms for the Taliban–“the group presently secreting Osama bin Laden…the most wanted individual in the world at this time,” an agent pointed out in court–that it begged a judge to keep a confidential informant for whom Ingram would launder money out of jail precisely because the government wanted to snare as many people as it could in this sting operation. The charges now seem even more unsettling, given the September 11 terrorist attacks on the WorldTrade Center and the Pentagon. While Ingram’s misdeeds pale in comparison with those horrific events, his crime exemplifies how the world terrorist network is supported in part by a web of people and governments that win a blind eye to the devastation caused by their profiteering.

In November Mohsen and Malik will go on trial for money laundering; next year they will be back in court for the more serious charge of arms dealing. Though both men have pleaded not guilty to all charges, prosecutors have more than 500 audio and video tapes that they claim document Mohsen and Malik’s efforts to buy a wide array of weapons, from Beretta 9mm pistols to Stinger missiles to an M2020, a nuclear-weapon component. Valentin Rodriguez, Mohsen’s court-appointed attorney, says the government believes this hardware may have been destined for the Democratic Republic of Congo and Pakistan. A government agent said in court he was concerned the arms may have been destined for Afghanistan– and Osama bin Laden, the Muslim fundamentalist considered the brains behind a slew of terrorist cells around the world.

As part of his plea bargain Ingram has agreed to be the government’s star witness against the pair–even though the fact of the September terrorist attacks may reduce Ingram’s chances for a lenient sentence. “It will be very difficult to erase what happened in New York in September,” says Rodriguez. That’s why the Mohsen-Malik trial, scheduled to begin on November 7, promises to be one of the most closely watched court cases of the year.

HOW DID INGRAM–A GENIAL, STANFORD-EDUCATED MBA with more than 13 years’ experience at top-tier investment banks and a raft of high-powered friends–come to be implicated in a second-rate scheme to divert arms to third world countries? Though Ingram repeatedly declined to comment for this story, interviews with more than 60 of his friends and colleagues sketch a picture of a man in love with his ostentatious lifestyle, a man who believed that as a black trader in the lily-white provinces of Wall Street, he had been denied the rewards that were his due. Ingram grew up one of five children in inner-city Philadelphia and made it through college and grad school only to see his high-flying career as a trader flame out in an ugly lawsuit with Deutsche Bank, his last employer. As his financial situation deteriorated, friends say, he scrambled to hang on to a life that included a 44-foot yacht, a Prada-loving wife, and the most expensive Porsche made: a Turbo 911 the color of platinum.

As Ingram built his fortune, he skated effortlessly between two discrete elites, one largely white, the other almost exclusively black. Among the powerful white mentors who helped Ingram in his career were former Goldman Sachs chieftain Jon Corzine (now a U.S. senator from New Jersey) and former U.S. Treasury secretary Robert Rubin, now chairman of Citigroup’s executive committee. Ingram was also plugged into the close-knit circle of affluent black businessmen on Wall Street and in the entertainment world. His friends included Ronald Blaylock of Blaylock Partners, the leading New York–based black investment bank, and Kevin Cohee, CEO of the Boston Bank of Commerce, the third-largest black-owned bank in the country. He was also close to rap mogul Russell Simmons and his wife Kimora, and in recent years Ingram sometimes traveled in a posse of high-profile hip-hop honchos including Andre Harrell and Sean “Puffy” Combs.

Ingram did not restrict his friendships to accomplished blacks. He was “a chameleon,” recalls one friend. “He can talk to Bob Rubin about world economic affairs, but he can also talk to the guy sweeping the floor.” But in spite of his early success, he came to believe that his career was hampered by racism after he was denied a partnership at Goldman Sachs, and then was fired by Deutsche Bank some years later.

Whatever combination of greed, hubris, and anger compelled Ingram to commit a crime, its impact continues to reverberate on Wall Street, where he had come to be seen as an African-American success story, a role model whose progress was admiringly chronicled in the press. In 1996 his remarkable ascent was celebrated on the cover of Black Enterprise magazine. In 1997 Crain’s New York Business included him on its influential “40 Under 40” list.

Since his arrest, blacks who have struggled to establish themselves on Wall Street have expressed concern about a backlash, especially in the wake of Alan Bond, a money manager who is awaiting trial on charges of looting his clients’ accounts, and of Joseph Jett, the rogue trader blamed for taking down Kidder Peabody in the early ’90s. “Kevin has to accept accountability for taking us back a few years,” sighs a black friend of Ingram’s who works on Wall Street. “We’ll all have to crawl out from the rubble.” Some of his former mentors feel betrayed as well: “This guy has had every break in the world,” says Paul Jacobson, who worked closely with Ingram at Goldman and later at Deutsche Bank. “So many powerful guys on the Street tried to make up for the lack of progress for minorities in the industry by helping Kevin. He’s let a lot of people down.”

EVEN AS HE WAS TAKING UP THE CLOAK AND dagger, Ingram kept one foot in legitimate pursuits. One afternoon in mid-1999 he pulled into the driveway of Corzine’s white colonial house in the leafy, prosperous suburb of Summit, New Jersey. The two greeted each other warmly; Corzine had been one of Ingram’s closest allies at Goldman Sachs since the ’80s, when Ingram worked on the mortgage desk and Corzine headed up government bonds. But both men had since moved on: Ingram was busy raising funds for a new Internet company called TruMarkets, and Corzine, forced out of Goldman Sachs by his partners, had just kicked off what would be the most expensive campaign ever for a U.S. Senate seat.

Joining them at the house was Gary Morgenthaler, a highly respected venture capitalist from California who had invested millions inTruMarkets, Ingram’s drawing-board venture.

Corzine listened attentively as Ingram pitched his idea: an eBay-like system that would pair bond buyers with sellers, side-stepping the big Wall Street dealers and thus saving institutional clients billions in commissions. The appetite for dot-coms was then insatiable, and though others were racing to do the same thing, Corzine believed his old colleague had the edge. He ended up tossing about $1.75 million into the business (which was sold out of bankruptcy proceedings in March). Today Corzine doubts he will ever recoup his investment. But he says he’s more disturbed by Ingram’s emotional malfeasance than he is at his own financial loss. “The tragedy is this guy is a role model for what could be,” says Corzine sadly, “the model for a lot of folks who have real dreams of making a successful life in American business. He had a unique personality; he could convince other people to believe in themselves. It’s a tragic loss of opportunity. It’s tragic for his own life.”

INGRAM’S EARLY LIFE WAS MARRED BY TRAGEDY as well. One of five children born to a middle-class family, he grew up in a gritty pocket of North Philadelphia. When Ingram was four, his father Nathan, a 43-year-old property assessor for the city, was found dead in a room at Philadelphia’s Sylvania Hotel. Ingram told some colleagues his father had been murdered after he tried to start a construction business that trespassed on the turf of a mobbed-up union. But many relatives believe he committed suicide.

An ambitious entrepreneur, Nathan Ingram owned and managed several inner-city residential properties, and when he died in 1963, his wife Doris, a no-nonsense Bible-literate woman, took over the business. keep her kids out of trouble she required that each take up a musical instrument. (Kevin chose the saxophone.)

Nathan had the foresight to set up a trust, and all his children went to college. Kevin set off to MIT, and after graduating with a degree in chemical engineering in 1980, he took related courses at Stanford but left in June 1981 to work as an engineer. Soon afterward, Talk has leamed, he had his first run-in with the law. In February 1982 he was jailed in Sacramento, California, for passing bad checks and for misdemeanor property theft. Case records have since been destroyed, but Ingram served five weekends in jail and was placed on a two-year probation; in 1984 the conviction was set aside.

In September 1982 Ingram returned to Stanford, winning one of the 318 coveted places in that year’s freshman business school class; he was encouraged to enroll by a college friend. One former instructor at the top-ranked business school remembers Ingram as a standout student with a maverick streak. For the annual MBA Student Show, Ingram played Mr. T, shaving his hair into a Mohawk to spoof the TV star. Soon afterward he interviewed with a major Wall Street firm. “Most people were trying to look their best and fit the mold,” says the teacher. “His attitude was, This is me. Take it or leave it.”

It was an attitude that seemed to apply to his personal life as well. While at Stanford, Ingram was married to Aleta Hayes, the daughter of a physician and the valedictorian of her Fresno high school class. A friend recalls that the union lasted barely a year. After graduating from Stanford in June 1984, Ingram headed for Wall Street, where he settled into his first job: working on the mortgage-backed securities desk at Lehman Brothers. It was an inauspicious debut. Mortgages were the financial instrument du jour, and traders required “quant” skills in abundance and quarts of stamina. But coworkers claim Ingram was distinguished mainly by his spotty attendance record: In an office where arriving at 7 a.m. was considered late, he would regularly clock in at 10 a.m. In the fishbowl of a trading desk this behavior would elicit a brusque” ‘What the flick is wrong with you?'” one supervisor remembers. “‘I’m having trouble with my girlfriend–our schedules aren’t together,’ he’d say” Some days Ingram would leave w ork on his skateboard. “It was weird,” the supervisor recalls. “He was a very well-educated guy. And he badly wanted to be successful.” But at times he behaved like an unruly child: “He tried to defy almost every rule you set up.”

Lehman decided to send Ingram a message by paying him less than his colleagues–a tactic employed by Wall Street firms to get underperforming employees to leave. Ingram took the hint. In January 1986, to the surprise of envious Lehman colleagues, he landed a plum job at Goldman Sachs, lured there by Paul Jacobson, who ran Goldman’s mortgage desk.

At the time, Wall Street firms were under pressure to diversify, and Ingram’s advanced math skills made him an especially prized commodity. He was one of only six black bond traders in Goldman’s stable.

Eager to redeem himself in his new job, Ingram cultivated an impressive roster of mentors: There was Jacobson, who not only helped hire Ingram at Goldman but would hire him later at Deutsche Bank. And there was Bob Rubin, the cochairman of Goldman from 1990 to 1992, who went on to head the National Economic Council and later serve at Treasury. Rubin had a strong personal relationship with Ingram. “They would talk about issues other than Goldman Sachs,” says a former Goldman partner. “You can’t get any better than that. Rubin’s a no-bullshit guy.” (Rubin declined to comment on his former protege.)

As CEO, Corzine would call Ingram into his office for advice on managing the mortgage portfolio. Another Ingram supporter, Michael Mortara, a trader immortalized in the book Liar’s Poker, promoted Ingram to head the mortgage desk. Corzine and Mortara badly wanted to see Ingram make partner: Started by German Jews in 1869, Goldman had had just one black partner in its entire history when Ingram arrived. Blacks mainly worked in Goldman’s mail room, in the cafeteria, as support staff, or in sales. Corzine and Mortara believed Ingram had the skills to make it to the top of the firm. In 1994, a tough year in the markets, Ingram was told he probably wouldn’t be making partner. He was crushed. He was earning $1 million a year based on his trading successes, but he felt he was being held to a higher standard than his white colleagues, says an acquaintance, Earl Graves Jr., CEO of Black Enterprise magazine.

Why wasn’t Ingram made partner? “Mike and I had common views that we had a really extraordinary talent on our hands,” says Corzine. “But we knew that Kevin would always be difficult to manage. [It was] difficult to understand completely what was driving him.” One former partner insists racism had nothing to do with it. Instead he claims Ingram was “falling asleep at the trading desk and not showing up at work for days on end.”

Ingram’s increasingly flashy lifestyle was conspicuous in the context of Goldman’s buttoned-up culture. Ingram began to spend lavishly on clothes. He was partial to Hermes and Zegna ties and Armani, Gucci, and Prada suits. “Kevin was one of the top 25 blacks on Wall Street, but he was the best dressed,” says a friend. A wardrobe of watches expanded to include a Patek Philippe, a Cartier, and multiple Rolexes, including one $20,000 gold model. He also liked to eat well and was a regular at Nobu and Le Cirque. He spent thousands of dollars a year just on champagne, says a close friend; Cristal was his preferred label. He frequently threw big parties.

Ingram encouraged Goldman to hire more blacks, spearheading recruitment efforts at traditionally black colleges. Unlike some other black Goldman executives, Ingram refused to play down his blackness at the predominately white firm, say sources who note that the talk about one senior black executive was that he had done well at the firm because he’d been adopted as a child by a white family Instead, Ingram told one friend that he thought of himself as a “Tuskegee airman,” recalling the experimental unit of brash black fighter pilots who proved themselves in World War II. Ingram would invite young blacks working in the Goldman Sachs mail room to parties at his apartment, where they would mingle with the likes of Andre Harrell and Russell Simmons. “Kevin had a host of guys rooting for him,” says a friend. Increasingly, when he wasn’t working he preferred to keep the company of other black professionals and celebrities. Among the shooters in his Saturday morning basketball league were Simmons, Harrell, Puffy Com bs, and LL Cool J, as well as prominent black financiers including Advent Capital’s Tracy Maitland, Merrill Lynch’s Edward Johnson, and Derek Johnson, CEO of the Apollo Theatre Foundation.

In 1996 Ingram was tipped off by his gurus that he was unlikely to make partner that year, either. When his mentor Jacobson jumped to Deutsche Bank and offered him an opportunity to double his salary to $2 million, Ingram informed Mortara he was quitting. Sources say Mortara was furious; he had planned to push Ingram for partner in 1998. “Mike would have gone to the wall for him if he’d stayed and not screwed up,” says Corzine.

By then Ingram was also divorcing his second wife, Demetra Harrison, who had been a back-office accountant at Goldman. They’d married in 1988, and their relationship had produced one son. (Right before he married Harrison, Ingram had a son with a woman he once lived with in Brooklyn.) Acquaintances of Ingram’s remember Harrison as a quiet, conservative, practical woman who grounded him. But when they divorced, Ingram settled into a luxe Jersey City bachelor pad and began partying harder than ever before. The space was three apartments fashioned into one: There was a small screening room, a pool table, expensive African art, and super-high-end stereo equipment. The garage downstairs housed his brown Bentley and his Harley-Davidson and Ducati motorcycles.

Warming up to his bachelor lifestyle, Ingram dated frequently and enjoyed taking his dates clothes-shopping. One associate remembers that he would flip through Vogue until he got to a model he liked, and then call up her agency to ask the model out. After a few years of playing the field, he decided to settle down, and in 1998, he married for the third time, at the tony Water Club in New York. His new wife, DeannAbsolam, was almost 15 years younger than he was and about half a foot taller, a sometime Tommy Hilfiger model who had briefly worked as an assistant at Def Jam Records, Like Puffy Combs, Absolam bragged that she never wore the same clothes twice and sometimes wore two Rolexes on her wrist at once.

Friends say Ingram was infatuated with his Gucci-obsessed wife and the lifestyle that thrilled her. He became a regular presence on Manhattan’s late-night club scene; he still owns a 2 percent stake in NV, a Soho nightclub where Mariah Carey used to be a regular. As he became increasingly immersed in this nocturnal new world, he cut back time spent with friends who worked on the Street. “The guys who could really help him became a smaller and smaller part of his life,” says one former mentor.

For a while, at least, his social life didn’t seem to have any effect on his career. At Deutsche Bank he got off to a good start, successfully hiring away a troop of Goldman colleagues; by mid-1997 his staff numbered about 100. But Edson Mitchell, who was on the bank’s management board and ran the firm’s global trading operations from London, never liked Ingram.

Ingram’s department was highly profitable, grossing nearly $100 million in 1997; that year, his bonus was $3 million. But in l998 his luck suddenly ran dry. That year, the bond market was knocked off its feet when a massively leveraged hedge fund in Greenwich, Connecticut– Long-Term Capital Management– needed to be bailed out by a collective of other Wall Street firms. In the resulting market turmoil, Ingram’s trading desks suffered substantial losses (as did other bond desks on Wall Street). He had recently won a promotion and a transfer to London–the bank had even thrown him a going-away party. Ingram was house hunting in London when he suddenly found out he’d been fired.

Around Deutsche Bank, the word was that Mitchell had tired of Ingram’s erratic behavior and frequent absences, and had even issued him a warning. The outraged trader told friends he was convinced that his German bosses had it in for him because he was black, and he contacted Jesse Jackson’s staff at the Rainbow/PUSH Coalition’s Wall Street Project to see if the reverend could intervene. Ingram didn’t want his job back; instead, several sources say, he demanded $20 million in severance pay. “It seemed unbelievable to Kevin that he would need the help of Reverend Jackson,” remembers Chee Chee Williams, who headed Jackson’s Wall Street Project.

In March 1999, at Deutsche Bank’s high-tech midtown Manhattan headquarters, Ingram and Jackson met with Mitchell and Josef Ackermann, Deutsche Bank’s number two. Ingram argued that white guys who were Mitchell’s buddies had lost more money than he had but managed to keep their jobs and pull bigger bonuses. At one point in the meeting, sources say, Ingram began to weep. Jackson “was amazed by how much Kevin was crying,” says a source. Finally, Ingram left the 45-minute meeting to regain his composure.

In early May Ingram and Deutsche Bank convened in Manhattan for another fruitless mediation session. By then Deutsche Bank wanted to force settlement, and so the bank filed suit against Ingram–after he’d filed an action against the bank in the UK. Large institutions don’t tend to sue black employees who have charged them with discrimination, but Deutsche Bank was brutal in its accusations. The firm charged that Ingram had ignored strict limits imposed on his balance sheet, causing the firm financial losses. The bank also complained of missed meetings, unexplained disappearances that often lasted for days at a time. In private, friends speculated that with all his trips to the bathroom and sleepless nights, the trader might be bingeing on drugs (even if they’d never seen him do it). Publicly Deutsche Bank said that Ingram double-dipped on expenses and attempted to charge the firm for a wedding he’d canceled in 1998.

The two sides eventually agreed to an out-of-court settlement, and though Ingram walked away with about $6 million, his battle with Deutsche Bank left him embittered. “The guy had a chip on his shoulder. He was loyal to no one,” says one former Goldman partner. “He told me, ‘From now on I’m looking out for myself”‘

INGRAM WAS NOW POISED FOR A roll with Randy Glass. Glass, a 49-year-old from Boca Raton, Florida, with the affect of a Jewish Joe Pesci, was well known to Florida law enforcement officials. A putative jeweler who also went by the names Randy Goldberg and Randi Goodstein, Glass had bilked diamond and jewelry wholesalers in locales ranging from South America to Toronto out of $6 million. He’d also conned insurance companies by pretending he had been robbed. One phony 1993 claim had Glass telling police on Thanksgiving Day that he had been robbed of $250,000 in diamonds on a Chicago street corner. In April 1996 Glass said burglars had stolen $1 million in jewels from his Palm Beach store. But Glass was careless, and in 1998 he suddenly found himself facing 13 federal charges, which carried a maximum penalty of 130 years.

Desperate to avoid jail, on December 2, 1998, Glass approached the Bureau of Alcohol, Tobacco, and Firearms and said he knew someone involved with illegal arms deals. He agreed to cooperate with an ATF sting if prosecutors helped reduce his jail time.

Five days later Glass called a meeting with Diaa Mohsen, whom he identified to ATF agents as an arms dealer he had met two years earlier at the Taj Mahal casino in Las Vegas. A former Olympic long-jumper who speaks nine languages, Mohsen had been a US. citizen for 30 years; he claimed to be a lumber and commodities broker but he’d also worked as a ticket-taker at New Jersey’s Meadowlands sports complex. Glass told Mohsen he knew army-base people who could supply him with artillery. Court papers say that Mohsen eagerly inquired about howitzers, grenade launchers, and surface-to-air missiles, and even asked if Glass could get hold of an MR2020, a nuclear-weapon component. The ATF affidavit says that Mohsen told Glass that a friend of Mohsen’s–Mohammed “Mike” Malik–was negotiating with an individual who was seeking arms on behalf of an unnamed foreign country According to court papers, Mohsen says this individual wondered whether Glass would accept heroin as partial payment. By August, court papers say, Mohse n, Malik, and an individual named “Abbas” had flown down to Fort Lauderdale to inspect Glass’s goods, which had been assembled by the ATF. Throughout the sting, Glass made tape recordings for the government, and he was talking one night with Diaa Mohsen, say court papers, when Mohsen suddenly said that the Taliban was seeking arms, too.

The question of how Glass would dispose of some of the $32 million in arms payments naturally arose. Mohsen suggested that Glass get in touch with Ingram, whom he’d met through their mutual car detailer, says a source close to Mohsen.

At the time, Ingram, whose Wall Street career had effectively stalled, was restlessly seeking other options. He rented an office at the World Trade Center, which became the base for five new businesses: two restaurant development companies, a Brooklyn realty firm, a company that would form the basis of TruMarkets, and BIA (for Black-Italian-Arab) Construction Corp. Diaa Mohsen and a New Jersey contractor named Rocco Romeo were partners in BIA.

Ingram took his first meeting with Glass and Mohsen at the World Trade Center in June 1999, according to an ATF affidavit. Glass handed the fallen trader $100,000 in cash and told Ingram that the money was proceeds from illegal weapons sales. A paranoid Ingram asked Glass to “retract” the statement–perhaps suspecting that Glass was wearing a wire (which he was). Calming down, Ingram handed Glass a check for $91,000– keeping $9,000 for himself as a commission.

There is a memo from this period outlining Ingram’s plan for the “IAM Global Money Fund”–just as if he were presenting to a Ford pension-fund executive. Ingram detailed how the crew might start a $30-million fund outside of government regulation. In his bulleted one-page “Executive Summary,” Ingram proposed setting up an offshore account with an initial investment between $25 million and $30 million.

The intrigue clearly whetted Ingram’s appetite. One month later he called Glass to discuss ways that he could launder $250,000, says the affidavit. On August 4 Glass invited Mohsen and Ingram to a meeting at his Boca Raton residence, where he was joined by two undercover agents. A government videotape showed the five men drinking Gatorade as Ingram diagrammed plans to set up the Cayman Islands fund on white poster board.

As the meeting drew to a close, Glass dumped money out of a black trash bag. He passed Ingram and Mohsen the $250,000, says the government affidavit. Mohsen then transferred the money into a black carry-on bag. Ingram got on a computer to send instructions on wiring $227,500 of his own money (minus his nine percent commission, of course) to an account in London he didn’t realize had been set up by federal agents. Mohsen and Ingram then tooled away in Ingram’s Ferrari Spider, high on the glucose of quick cash.

IN THE SUMMER OF 1999 INGRAM also decided to pursue a potentially more lucrative project: an Internet venture that would challenge the very desks at Goldman Sachs and Deutsche Bank he used to work for. TruMarkets would be a cheaper, more efficient alternative to the old-fashioned way.

Morgenthaler Ventures checked out Ingram with his old boss Robert Rubin shortly after signing on as TruMarkets’s lead investor. In January 2000 the company was launched from nondescript offices in Manhattan directly across the street from the Empire State Building. Ronald Blaylock joined Jon Corzine as an equity investor.

Ingram, CEO of the newly minted venture, threw in $3 million of his own money and hired about 50 people. In December 2000 the technology looked so promising that Morgenthaler recruited two Wall Street luminaries for the board: former Merrill Lynch president Herbert Allison and former Charles Schwab COO Ronald Readmond. But by early 2001 the party suddenly ran out of champagne.

TruMarkets software was in trouble. By January 2001, Ingram had been replaced as CEO by Readmond–because Ingram had trouble sticking to a budget, says one major investor. TruMarkets had hired Morgan Stanley’s former international chief information officer to rebuild the software. But after three months of 90-hour weeks, TruMarkets had ripped through some $30 million in all and missed its launch deadline. Venture capitalists were now fleeing dot-coms in droves. Ingram, who remained at TruMarkets as a director, struggled to find additional financing. But no one bit.

Early in 2001 Ingram threw himself into negotiations with MortgageSight, a consortium of Wall Street firms. But in the middle of the negotiations, Ingram suddenly disappeared. People were saying at one point that he’d traveled to Switzerland, one investor recalls. On March 29, 200l, creditors threw the company into Chapter 7–involuntary bankruptcy–on the same day MortgageSight reached an agreement to buy the firm.

EVEN AS INGRAM FACED MOUNTING business pressures, the feds were moving in for the sting’s third–and final–act. In June, an undercover ATF agent met with Ingram to dean $2.2 million dollars gleaned from arms sales. Instead of offering to take the cash and wire the money, Ingram said he knew a guy with a Learjet who could fly the cash out of the country, according to an ATF affidavit. The idea was that the agent’s London-based partner would meet Ingram and Walter Kapij for the hand-off. Ingram would take a 20 percent cut ($440,000); Kapij would expect five percent ($110,000), say court papers.

On June 12 the agent rendezvoused with Ingram at a Fort Lauderdale hotel, where Ingram introduced airplane broker Kapij as his partner, according to the ATF affidavit. (Kapij had been a golfing buddy of Ingram’s, says Kapij’s attorney James Eisenberg.) Another special agent then arrived at the hotel with the money. The government says Ingram and Kapij accepted the two cases and were arrested on the spot. “All of a sudden there were agents pointing guns at them,” says Eisenberg.

When news of Ingram’s arrest broke, his TruMarkets colleagues were dumbfounded. “It was like an April Fool’s joke,” says one big investor. “This was not the person I had known. Kevin put his heart and soul in building TruMarkets. He was a person of unbelievable energy, ethical to a fault in his treatment of employees and customers.”

Ingram spent three weeks in the Palm Beach County jail. His twin sister Karen came to visit him, but his mother did not; Ingram didn’t want her to see him in jail.

Meanwhile top blacks on Wall Street are distancing themselves from Ingram. “I definitely heard the buzz on the beach at Martha’s Vineyard this summer,” says Lawrence Otis Graham, author of Our Kind of People: Inside America’s Black Upper Class. “A lot of successful blacks are always worried about things that will reflect poorly on the group…. This came up when Alan Bond was in the paper, and it came up with Kevin Ingram.” Still, Graham notes that Ingram was never much of a presence in the civic and philanthropic worlds, and that his presence won’t be missed as much as Bond’s.

Attorneys for Mohsen and Malik believe that other people may be implicated as Ingram casts about for ways to reduce his jail time. Malik’s attorney James Eisenberg offers cryptically, “Ingram’s got information on more than just the clients in this case.” In a sidewalk chat in front of the courthouse in West Palm Beach, Ingram’s lawyer Richard Lubin is quick to point out, “The only illegality my client has been involved in is this one.”

Lubin, who is among the best-known criminal attorneys in Palm Beach County, remains upbeat. He believes Ingram will be sentenced to only two or three years in jail–and maybe less–for cooperating with the government.

In the meantime, Ingram’s alleged coconspirators are busily preparing their defenses. Mohsen and Malik will claim that Randy Glass convinced them that Glass was a U.S. government employee selling arms on behalf of a U.S. government agency, say lawyers Rodriguez and Eisenberg. “Glass let it be known that this was a covert operation similar to Iran-contra,” says Eisenberg. “He convinced these guys he was working for a clandestine U.S. government agency Kapij will maintain that he was merely offering a hitchhiker–Ingram–a ride to Europe. And Glass is now serving a seven-month jail term.

Ingram is busy too, asking friends and family to write letters to the court on his behalf. Some will vouch for him and some won’t.

“Kevin allowed his integrity to be compromised in his lust to continue to get paid,” says a friend and former coworker. “You can’t be willing to compromise your integrity to eat at Le Cirque or La Cote Basque every night.”

Additional reporting by Lee Bailey, Nancy Beiles, Erin Medea, and Victoria Petitt.

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