Members of the capital investment industry and especially Wall Street will remember the Southport Lane Scandal headed by self-proclaimed financial prodigy Alexander Chatfield Burns. The criminal activity had been occurring long before The Wall Street Journal got wind of it. But all it took was one rule-following, good-natured, morally-sound employee to connect the dots and secretly sound the alarm. Pirate Cove by Richard D. Bailey is a first-person insider’s account as to how Richard unraveled the massive $350 million fraud and brought down one of the biggest white-collar crimes in New York.
Bailey’s friend Jeff, who worked at Southport, proposed a possibly high-paying job opportunity. Bailey would conduct an audit of a pharmaceutical company to determine if Southport AKA Burns should purchase it. Impressed with his work, Burns offers Bailey a job as CEO of his vineyard. Having been out of a regular job for quite some time, Bailey accepts. However, when he does more research on the shape of the vineyard and wine company, he learns that Burns purchased it for twice its value. Oh, and it loses about $750K each year. Needless to say, Bailey has his work cut out for him. And he had zero experience in the wine industry. Even so, he’s a numbers guy, and has decades of experience managing large sums of money. So he gets to work. Little does he know, Southport would be more detrimental to the wine company than he could have ever imagined.
After balancing the books and hiring the right people, the vague goings-on at Southport with Burns and his right-hand men start to concern Bailey. Burns is still running businesses without a clue as to how to manage them. And there’s millions of dollars of money moving around – some of which, Bailey discovered, might not actually exist. And when he has solid evidence of suspected wrongdoing, he can’t ignore it. So he lines his ducks in a row at the wine company, consults some qualified friends, and eventually gets law enforcement involved. When the FBI gets involved and asks him to wear a wire, there’s no going back.
Bailey must have a secret talent for storytelling that he didn’t tap into until writing Pirate Cove. While the entire situation is fascinating to begin with, it’s Bailey’s delivery that hooks readers from the very start. Not only that, as someone who has little to no familiarity or interest in the industry, I was able to follow along with the terms and procedures thanks to Bailey’s clarity and explanations. I could sense the anxiety and panic that he felt during the most high-stakes moments when he had to get verbal confessions on tape. And I could grasp the internal struggle he felt regarding the tough decisions he had to make in order to do what’s right. In the end, it paid off. Bailey’s experience regarding the Southport Lane Scandal is a fascinating one. And his success in bringing the huge fraud scheme down is undoubtedly admirable.
Richard D. Bailey joins us for a Cantina Conversation to talk about his remarkable story and how he navigated the publishing process. Find the interview on the Cantina Book Club Podcast and order Pirate Cove: An Insider’s Account of the Infamous Southport Lane Scandal, available now.
