Fallen 'broker to stars' faces sentencing February 7, 2001 - USA TODAY (Pg. 3B) by Greg Farrell Queries about funds Giacchetto accused of stealing $10M NEW YORK -- Dana Giacchetto, who until his arrest last year was known as the "broker to the stars," might go down as the worst thing to hit Hollywood since the McCarthy hearings. The money manager parlayed his friendships with Leonardo DiCaprio, Michael Ovitz, Ben Affleck, Cameron Diaz and others into a star-studded client list that invested more than $ 100 million with him. Today, he is to be sentenced in federal court here for stealing almost $ 10 million of that money. But with the exception of the rock band Phish, from whom Giacchetto, 38, misappropriated $ 4.7 million, the majority of his victims are lesser known actors and artists. In 1999, a stream of Giacchetto's star clients asked for their money back or terminated Giacchetto as their money manager. Now Robert Geltzer, the trustee appointed by federal bankruptcy court to sort Giacchetto's company's affairs, is looking into how that happened. He says he is prepared to take legal action against anyone who inappropriately received money from Giacchetto. Neither Geltzer nor his attorney, Robert Wolf, would say whom they plan to target, but Geltzer says he won't back away from anyone, not even Hollywood's biggest names. "My job doesn't distinguish between little people and big people," Geltzer says. "What we do isn't based on who they are, it's based on when they received funds from Giacchetto and whether the funds they received were rightfully theirs. If we can show something is a fraudulent conveyance, I'll move to recover that money." Geltzer's efforts to untangle Giacchetto's complicated scheme of robbing Peter to pay Paul hit a roadblock last week. Judge Robert Patterson delayed Giacchetto's sentencing from mid-January until today so that Geltzer could question the ex-broker about the messy details of his firm's collapse. But when Geltzer started questioning him about his firm, the Cassandra Group, Giacchetto clammed up, citing Fifth Amendment rights. "He has in no way cooperated with us," says the Securities and Exchange Commission's Alexander Vasilescu. Geltzer has requested one last chance to debrief Giacchetto before he is shipped out of state to begin his prison term of at least 4 years. If Giacchetto again refuses, Geltzer and Vasilescu will be left to sift through an avalanche of sloppy records dating to 1997, a chronology of money transfers between Cassandra and its 300 clients, and the recollections of victims. One of those victims, documentary filmmaker Victoria Leacock, says Giacchetto approached her in 1999 while she was working on a film and asked her to sign a form. She didn't read it closely, she says, but trusted him and signed. She only learned later that she had put almost half of her savings in Giacchetto's hands. "He had me wire money over to him, and the next day, he wrote a check for the same amount to Michael Ovitz," she says, referring to SEC records. There is no indication that Ovitz or any other clients were aware of the broker's actions. "I kept calling Dana week after week after week," Leacock says. "Finally, he took me to lunch in March to tell me everything was going to be all right, and then he was arrested." According to the SEC's audit of the Cassandra Group's account at Citizen's Bank in Boston, one client wired $ 450,000 to Cassandra on Aug. 8, 1999. Before the wire, Cassandra's account had been overdrawn. Over the next 5 weeks, Giacchetto misappropriated money from Courtney Cox Arquette, Ben Stiller, Tobey Maguire, Lauren Holly and Lara Harris, while writing checks for hundreds of thousands of dollars to other clients. Those are among transactions investigators want to ask about. And while Geltzer vows to collect any money owed to Cassandra's creditors, ex-clients such as Leacock and artist George Ginder aren't optimistic. David Comarow, attorney for George and Cara Ginder, says Giacchetto not only misappropriated money from his clients' account, but also bought stock in Paradise Entertainment against Ginder's wishes. "That money's gone," says Comarow, "unless Dana's really good at making license plates."