Published August 17, 2016 by the Asbury Park Press
Chapter Six – The return of “Loudini”
Soon after his career on Wall Street ended with a whimper, Louis Spina had another plan.
Spina started his own trading firm, at first working with a relative, then alone, he said.
It was a simple operation. Use a computer program to buy stocks low, sell high and hustle short sales, bidding on a stock’s value decreasing. He worked from an office in Fair Haven.
But it wasn’t like the happy days on the trading floor. On the exchange, he had the upper hand. He was like an actor confident in his lines.
Now he was forced to ad lib.
“Instead of realizing it wasn’t working for whatever reason –- again, my pride, my stubbornness, thinking I’m this greatest trader ever –- I would just keep going till I made it work,” he said. “Once you jump off a bridge, you can’t come back.”
Then he met a woman who dumped money on the fire. In March 2011, she told him she’d like to become a partner and invest millions. The woman declined to comment.
Spina didn’t want a partner but was happy to take the money.
“You want to talk about downfalls?” he asked. “That was it.”
The charges he pleaded guilty to say Spina ultimately collected about $20 million from investors, guaranteeing tremendous monthly returns.
“I took the money, I didn’t invest it all,” Spina said. “I was afraid to, didn’t know how to.”
He used less than half of the money for investing. And he lost what he did invest. The rest he used to pay his investors the interest he owed them and return some of their cash. He lied to investors, telling them the business was going well.
In the middle of this meltdown, in May 2013, he married his fourth wife.
She asked not to be named because she didn’t want to be associated with the case. Her mother, her father and her brother invested with Spina, she told the Press. She gave him her IRA, worth about $100,000. She estimated that in total, her family handed him a little more than a million dollars.
“We all gave Louis our money because he was trading and he said everything was great,” she said. “He never told us, you know, that anything was wrong.”
Spina spent maybe $2 million or $3 million of what investors gave him, he said.
He bought cars, rented a luxury apartment, donated a total of $423,000 to the University of Miami, court records show. He said it was so his stepsons would be considered to attend there. His wife said he was a longtime supporter of the school and he phrased the donation as just another contribution.
In January 2013, Spina incorporated LJS trading in Florida, according to state records. The address listed for the business was a 2,500-square-foot condo Spina rented in South Beach worth $4.7 million.
“I know I made the mistakes,” Spina said. “I know I made the decisions, but this was not the plan. I mean, never was it a plan to run a Ponzi scheme. There was never – never even entered my mind. I still don’t think I was, but I guess if it walks like a duck, quacks like a duck, it’s a duck. But all I was trying to do was raise money to make the money back.”
The FBI agent who worked to catch Spina was doubtful.
“May it have gotten out of control at some point? Yes,” Supervisory Special Agent Jim DiOrio said at an FBI office in Red Bank. “But our belief was, and he was charged with and he plead guilty to, an intent to commit fraud.”
Spina said he didn’t have the guts to say it wasn’t working. And his painkiller habit was spiraling – 10 to 12 pills a day.
“It got bad when I didn’t like the person who I was,” he said of the pills.
Spina’s end came in November 2013.
He learned the FBI was investigating.
“I freaked,” he said. “I had no idea what to do.”
So he walked out the door with about $130,000 and a handful of pain pills in a University of Miami gym bag, he said.
Chapter Seven – Meltdown
The woman he said he worked with alerted Spina’s last wife, she recalled.
His wife called him, but he didn’t answer. She kept calling, over and over. Then she drove to the South Beach condo.
“Oh my god,” his wife thought. “I have to call my mother, my father, my brother. Like how do I tell them, not only like I just got married a few months ago, that Louis is missing? He’s not answering the call, and supposedly all the money is gone and I don’t know where he is.”
She arrived at the condo, calling him again and again from the lobby, she said. She was afraid to go upstairs, wondering if he killed himself.
The condo was silent, nothing apparently missing. The computer he used to trade was there. Next to the computer lay his wedding ring.
He didn’t usually take that off.
She called his best friend from the trading floor, the one who would later vouch for him at his sentencing. He told her Spina wouldn’t scam people.
“Absolutely not,” he recalled telling her. “That’s not even an option.”
Spina said he stayed at the Miami Ritz-Carlton for three days, paying cash, using a fake name. He swallowed 34 Oxycontin pills in a suicide attempt but threw them up.
He decided to go to the FBI in New Jersey and turn himself in. He got on a train because he didn’t want to take his gym bag full of cash and pills on a plane.
But in Washington, D.C., he said he was intercepted by four DEA agents dressed like hippies.
“It was the worst disguise I’ve ever seen,” Spina said.
He let them check his bag. They found the cash and pills. They thought he was a drug dealer.
Court records confirm DEA agents seized $132,789 from him at Union Station in Washington on Nov. 19, 2013.
Spina said he was embarrassed to be interrogated in front of people at the station, and he was cold, so he asked to go to an office. He confessed, later explaining himself to FBI agents.
They froze his trading accounts, took his credit cards. They gave him $500 for spending money.
He was not in custody as his case weaved through court.
But he was ordered by the court not to trade.
He returned to Florida in March 2014, he said, renting an apartment in Coral Gables. His wife said she didn’t depend on him for income. Spina said she did worry about money.
He lied to his wife about being barred from his craft. He started pretending that he was back in the game, working to repay investors.
But he was running out of money.
Over the course of about eight hours of interviews from prison, the only time Spina’s voice faltered was describing how he robbed a bank on May 12, 2014.
He was broke and desperate. He had $17 in his pocket.
He made his fake bomb. He drank tequila. He went to the Coral Gables, Florida, bank.
He arrived at about 9 a.m. For half an hour, he paced outside. He approached the entrance, pulling a black ski mask over his face, then backing off.
You can’t do this.
He wandered away from the building.
You don’t have a choice.
And he went in.
He approached the desk. It felt like he wasn’t really doing it, like somebody else was in his body, telling the clerks he had a bomb, he wanted money, no low bills.
He held a car key fob in hand, threatening to detonate.
He got out with $16,783, court records show.
“And the non-criminal, the dope I am, people saw me leave,” he said.
He didn’t realize a teller saw the car he drove – his wife’s Range Rover. He thought he got away.
A day later, he said he took the Range Rover to a car wash.
Court documents show he was arrested by Coral Gables police. He confessed.
Spina has been locked up ever since.
His friend from the stock exchange said he was furious with Spina. Why? Because Spina didn’t cut his trading losses like they did routinely when they were trading on the floor. Because he robbed a bank. Because he blew his path to an easy life. Spina caught the right breaks on the floor, rode the right wave – good times and good money.
“I was pissed off at him,” his friend recalled. “You had enough money to just move on. You didn’t have to work anymore.”
Spina apologized to the people he hurt.
“I hurt so many people,” he told the Asbury Park Press. “People I loved. My wife, my family, my ex-wife…her family, her kids, my kids, the people that I didn’t even know. All I can say is ‘I”m sorry’.”
The FBI agent who caught him was skeptical.
“I remember seeing him at his plea,” DiOrio said. “It takes a toll. I don’t know if that’s remorse or just anxiety, stress. Many times, at their plea and/or sentencing, they’ll find a way to convince the judge that they’re remorseful and sometimes it’s very valid, sometimes it’s not. It’s hard to tell.”
For the victims who collectively lost millions, DiOrio said the real cost has been damage to relationships. Though Spina’s fourth wife said she and her family lost about one million dollars, the lies hurt the most.
“I have to be honest, it wasn’t really so much the money, even though obviously nobody wants to lose money,” she said. “To me, it was just about the betrayal.”
Chapter Eight – Back to brown suits
Spina is back to brown suits – a prison khaki uniform and work boots. The man once too impatient to wait for a cup of coffee now waits 25 minutes for prison staff to open a gate for him to walk to lunch: a hot dog or chicken. Fish on Fridays.
Spina’s father tried to keep him away from the gangsters, but now he’s right there with them. He still wears a name tag, but now trader 2102 is inmate 66251-050.
He pleaded guilty to one count of wire fraud and was sentenced in June 2015 to 79 months in prison.
Because he robbed a bank, he was sentenced in October 2014 to spend another 41 months in prison.
He does OK in the prison on Joint Base McGuire-Dix-Lakehurst in the New Jersey Pine Barrens, he said. No fights, no trouble. He frequently calls his sons. He has become more religious, reading the Bible daily. His favorite part is the Book of Proverbs, an Old Testament section that dictates moral living.
The court seized his bank accounts. The University of Miami agreed to return Spina’s $423,000 donations, documents show.
Spina was ordered to repay $11,899,393.23 in ill-gotten gains, court documents show.
He had a job in the prison library making 12 cents an hour, then he moved up to a job putting a string through the waistband on Army pants. He learned how to make a pair – using serger machines, stitching bar tacks, crafting pockets. He gets 50 cents per bundle of 24 pants.
“I fight for that bundle like it was $10 million,” he said.
He gets up at 4:30 a.m., watching stocks on the news, putting in 12-hour days at his prison job. Exhaustion keeps his mind from racing with regret.
“I just love to compete and I could not face losing. I could not think I was losing. And I just kept digging myself a bigger hole, a bigger hole. The lies came with it. And I’ve got no one to blame but myself. But that’s what happened. It’s the fact that I could not face that I was losing at something that I thought I was really great at.”
Spina remains enterprising. He was interviewed to work in a management office.
They heard he’s good with numbers.