Start of the downward spiral

Published August 16, 2016 by the Asbury Park Press

Chapter Four: “Loudini”


Stockbroker Louis Spina distinguished himself with his talent for turning around a losing deal, a fellow trader confirmed, whittling away a deficit to break even or make money.

He earned the nickname “Loudini,” a fusion of Louis and Harry Houdini, a magician noted for his daring escapes.

Years later, that fellow trader recounted Spina’s reputation in a letter to the judge who sent Spina to prison. He let the judge know Spina was revered for his calm, collected manner. He heard the Loudini nickname used among the older folks they worked with, he told the Asbury Park Press. The fellow trader asked not to be named because he still works on the floor of the stock exchange.

Spina was someone he looked up to like an uncle, the broker wrote. Someone he wished he could become. He never expected Spina to break the law.

Like many brokers of his time, Spina caught the crest of a tremendous trading wave.

Stock trading volume surged in the 1970s and 1980s, according to Eugene White, an economics professor at Rutgers University, New Brunswick.

“For every trade, you get another commission,” White said. “So it’s a great time to be a broker –– more volume, more trading, more money.”

The bounty rained down for Spina.

He said he earned a 2 percent commission, clearing almost $200,000 on his best day.

At age 30, he took home $2.5 million in one year, Spina said, more than the coach for the New York Rangers, one of his favorite sports teams. That’s equivalent to $5.2 million today.

“That’s how I kept score,” he said. “That’s all I chased. Money.”

He spent like he earned. He shopped at Brooks Brothers and Barneys, he said. Property records confirm he bought a condo in Battery Park City, and a condo in Jupiter, Florida. In the colder months, he said, he would fly down on a Friday, come back on a Sunday.

“All the stupid stuff you do with money,” he said. “Women, wine.”

Spina rode private planes to Las Vegas, he said. He could have breakfast, lunch, dinner, drinks on the firm’s tab at the Stock Exchange Luncheon Club, a 108-year-old members-only dining room on the seventh floor. He’d take a limo to get a haircut.

He was impatient – if there was a line at a coffee shop, he’d drop money on the counter and not wait for change.

He dated around. He drank. He tried marijuana and cocaine. He wasn’t a big drug user, he said, but vices were plentiful around him on Wall Street.

“There was a lot of drugs, a lot of partying,” he said.

Spina married and divorced four times. He has three sons.

His third wife, Eileen, was married to Spina from 1994 to 2006 and confirmed he earned millions and lived lavishly, taking private flights, coveting the latest Mercedes, sporting custom suits, buying her jewelry, taking vacations to St. Martin in the Caribbean or their second home in Florida.

They moved to tony Colts Neck, closer to Eileen’s brother. They lived in a home now assessed at $1.5 million.

His 21-year-old son, James, recalled visiting the stock exchange for “bring your child to work” day. It was crowded. Overwhelming. Frightening. People yelling. His dad yelling back.

But his dad maintained a sense of calm.

“It kind of made him feel like a superhero, in a way,” James said.

The job took its toll on Spina. He’d commute up to two hours into the city, he’d come home exhausted.

“Just to get to work was a job in itself,” Eileen said.

Spina tried the prescription narcotic Percocet to take off the edge, he said.

“I loved the way it made me feel,” he said.

Anytime he wasn’t happy, he’d take a pill. But he insisted he wasn’t addicted at that time. He’d stop for a week or six months. Spina kept the drugs to himself. James and Eileen said they weren’t aware of his habit at the time.

In August 2001, the firm Spina worked for, Scavone, McKenna, Cloud and Company, was sold for $60 million to Van der Moolen, according to The New York Times. Spina said he was vested in the company and Eileen confirmed he took millions in profit from the sale.

“Again, how that person is in here,” Spina said from prison, “Is sometimes pretty hard to understand. But here I am.”

Chapter Five: Bliss didn’t last


A month after he made his millions, Spina was at the stock exchange on 9/11. He saw people leaping from the burning buildings, he saw the towers collapse. One of Eileen’s brothers was killed in the attack.

The couple divorced in 2006, each alleging verbal abuse against the other, among other grievances, court records show. Spina had to pay his ex-wife $5,000 alimony and $2,500 child support each month, according to court records.

Gradually, changes on Wall Street made characters like Spina less relevant. Loudini couldn’t escape computerized trading. Machines reduced his role – he’d work for five minutes in the morning and the computers would do the rest, Spina said.

“The job I loved on the floor turned into a photo op,” he said.

The stock exchange changed the rules on how prices were measured, evaporating margins for traders, according to White, the economics professor. And increasingly, trades were being made off the exchange.

“So what happened is the relative size of the New York Stock Exchange began to shrink,” he said.

Commissions for brokers and the volume they could trade fell.

Spina said his salary collapsed from millions a year to a couple hundred thousand.

Lehman Brothers took over the operation Spina worked for in 2007. After a record-breaking bankruptcy, Barclays bought them out. In 2009, Spina was demoted.

He said his income shrank to about $150,000 a year.

By August 2009, Spina’s declining income prevented him from paying what he owed his ex-wife, he wrote in a court filing. He started dating and spending heavily on a new girlfriend, he told the Press. At one point his American Express Platinum Card carried $40,000 in debt, he said.

“Trouble started when I couldn’t admit to myself that I was going to have to change my lifestyle,” he said.

Spina charged personal expenses on a company credit card, he said. He planned to pay it off when he got his bonus. But in March 2010, Spina said, the personal expenses were cited as a reason for his dismissal.

It hurt to go out that way, he said. Most guys leave with a great reputation – they ring the closing bell, their family comes, they have a little party.

“I was in total shock for at least two days,” he said from the prison just an hour drive from the million dollar home he once owned.

But he didn’t remain despondent for long. Loudini had another plan.

He wanted to prove everybody wrong.