This week, Dealbook's Andrew Ross Sorkin caught up with convicted Ponzi schemer Sam Israel, and it reminded why his story is so crazy.
It's not because he faked his own suicide or hid from the cops.
Israel's story is crazy because he didn't have to run the scheme in the first place. He came from one of the most powerful families in New York City.
The Israel's founded a commodities trading powerhouse that made millions from America's addiction to coffee and socialized with the famous and wealthy of New York.
The family commodities trading business was created by Samuel's grandfather, Leon Israel, in 1898 and after nearly 80 years, morphed into companies that you have definitely heard of.
Here's their story.
In the late 1800s, New Orleans became a coffee trading hub.
During the late 1800s, Coffee importers wanting access to the middle of North America via the Mississippi River, began to import their product through New Orleans. Before New Orleans became a coffee importing hub, New York was the only major coffee importing port in North America.
Coffee importing was risky. Not only did the buyer have to travel to South America, but they had to maintain contacts and negotiate with often law-less coffee growers.
Source: Louisiana State Museum
Leon Israel entered the New Orleans coffee trading business in 1898.
In 1898, Leon Israel began to import coffee from South America to New Orleans. The famous Magazine Street district in New Orleans became the coffee trading hub.
Leon Israel was the grandfather of the now incarcerated Ponzi scheme artist Samuel Israel III.
Source: The New York Times
When a yellow-fever epidemic hit New Orleans, he made a huge profit by going through New York.
In 1905, a yellow-fever epidemic hit New Orleans. This limited imports through the city because ships refused to dock and unload their goods. This created a shortage of demand, but allowed for huge profit making for those selling their product through New York.
Source: Louisiana State Museum
See the rest of the story at Business Insider
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