Kenneth I. Starr

Kenneth Ira Starr is a former American certified public accountant and attorney convicted of running a $30 million Ponzi scheme with the money of numerous wealthy and celebrity clients.^[1][2][3][4] Sentenced in March 2011, Starr is currently serving out his 7.5-year prison term at the Otisville, New York Federal Correctional Institution and is due to be released in 2016.^[5]

Early career and financial problems

After working for various Manhattan investment firms, Starr formed in his own investment company, Starr & Company, LLC (Starrco), and would subsequently gain many wealthy and well-known clients including a Who's-Who of Hollywood stars like Al Pacino, Natalie Portman, Martin Scorsese, Carly Simon, Wesley Snipes, Sylvester Stallone, and Uma Thurman.^[6]

Starr's financial and legal problems began to surface in the late-1990s after being sued by Sylvester Stallone in connection with the Planet Hollywood restaurant chain and Starr's alleged role in Stallone's $10 million loss. After this financial setback and still married to his current third wife, Starr had the unfortunate fate of meeting his future fourth wife, Diane Passage, a money-obsessed stripper who Starr was eager to satisfy financially. As his financial world began to crumble, Starr's then-third wife, Marisa Vucci Starr, resigned as Starrco's office manager which led to further problems for Starr and and his failing company, Starrco.^[7]

The Ponzi scheme and investigation

Starr initially made large amounts money for clients but then began using client assets for both personal expenses (including the purchase a $7.5 million condominium complete with a swimming pool and 1,500-square-foot (140 m²) garden) and high-risk investments in which he and his associates had financial interests.^[8] As personal expenses increased and various high-risk investments failed, Starr began stealing funds outright from older clients and using subsequent investments from newer clients to cover up the prior thefts, thus giving life to the Ponzi scheme that would eventually lead to his downfall.^[9]

After having fraudulently obtained power of attorney over the assets of one such client, an elderly 93-year-old named Joan Stanton, Starr then depleted her funds and was subsequently sued by her in civil court in April 2008.^[10] After Stanton died in 2009, her daughter, Jane Stanton Hitchcock, went to the United States District Court for the Southern District of New York who then began a federal criminal investigation of Starr leading to the uncovering of his multi-million dollar Ponzi scheme and his eventual indictment, arrest, conviction, and sentencing.^[11]

Indictment, arrest, conviction, and sentencing

In May 2010, Starr was indicted and arrested on 23 criminal counts including various fraud charges and money laundering.^[12] When authorities went to arrest him, they found him hiding in a closet at the very upscale Manhattan apartment he allegedly purchased and lavishly furnished from stolen funds.

At a bail hearing in July 2010, Starr's bail was set at $10 million which he did not post.^[13]

In September 2010, Starr pleaded guilty in federal court and was sentenced by United States District Court judge, Shira Scheindlin, in March 2011 to a 7.5-year prison term.^[14]

Starr is currently serving out his prison sentence at the Federal Correctional Institution located in Otisville, New York, and is scheduled to be released on December 8, 2016.^[15]

The investigation of Starr also led to the arrest and conviction of longtime Democratic politician, New York City Council member, and former Manhattan Borough President, Andrew Stein; for lying to federal investigators about his involvement with Starr's multi-million dollar Ponzi scheme. He was later sentenced to 500 hours of community service.^[16]

Personal life

Starr was born to the son of a public school official in the South Bronx and entered Queens College at age 15.^[17]

Starr has been married four times. He and first wife, Gail Starr, have two children: son, Rob Starr, and daughter, Terri Starr.^[18][19]

After divorcing his first wife, he married second wife, Sheila Starr, who was his then-current office manager. Sheila Starr then hired Starr's future third wife, Marisa Vucci Starr, to replace her as office manager.^[20]

After divorcing his second wife, Starr was married in 1991 to third wife, Marisa Vucci Starr, Starrco's then-current office manager.^[21] While still married to third wife, Marisa, who was by then suffering from advanced multiple sclerosis, Starr met Diane Passage, a single mother and dancer at the Scores strip club in Manhattan.^[22] In 2007, Starr and Marisa divorced; the couple has two daughters.

In 2007, Starr married his fourth wife, Diane Passage, who then stopped working as a stripper at Scores.^[23] After her husband's imprisonment in the fall of 2010, Passage filed for divorce in July 2011 claiming she could not wait for the completion of his prison sentence ending in 2016.^[24]

References