Sunday, November 16, 2014

Joel Klein Mentor Gets 3-Year Prison Term Over Misuse of Funds

Exclusive photo taken the other day by Ed Notes Joel Klein surveillance team
Thomas Middelhoff, Ex-Chief of Bertelsmann, Gets 3-Year Prison Term Over Misuse of Funds ... The court in Essen on Friday found Mr. Middelhoff guilty of 27 counts of embezzlement, involving a total of 800,000 euros, or about $996,000, and three counts of tax evasion. ...NY Times
Mr. Klein became chairman and chief executive of Bertelsmann Inc., the corporate-services arm of the German media giant, in January 2001. His departure, friends said, is unrelated to the ouster over the weekend of Thomas Middelhoff, the parent company's chairman and chief executive. Mr. Middelhoff had recruited Mr. Klein to the company after meeting him at a dinner party at the home of the powerful Washington lawyer Vernon Jordan.
Mr. Klein has told friends that he was restless as a corporate executive and was eager to return to public service.... NY Times, July 30, 2002, upon Klein becoming Chancellor.
When Middelhoff took his fall as Bertelsman chief, Klein was dumped too - and Bloomberg saved his career.

Perdido St has an interesting piece - NYCDOE Getting Rid Of Joel Klein's $95 Million Dollar Computer System Boondoggle

I always used to day that one day Joel Klein would one day be doing a perp walk in cuffs and bag over his head. Well, it hasn't happened - yet. But seeing Middlehoff, who hired uncle Joel after he left the Justice Dept. take this fall, there is always hope.

Here's an interesting note from a Aug. 1999 piece in the Observor:
Judging by the turnout for his 46th-birthday party, Bertelsmann A.G.’s chief executive, Thomas Middelhoff, has successfully tunneled his way into America’s media landscape. What a strange, brief trip it’s been. Seven months ago, Mr. Middelhoff ascended to the top spot of the world’s third-largest media conglomerate, a sprawling empire based in Gütersloh, Germany, that produces books, music, TV shows, magazines and newspapers, as well as maintaining a strong foothold in e-commerce and other on-line services. It is a company familiar to few laypeople despite a presence in more than 50 countries. And yet there he was, on Friday, May 14, in the private Bellecour Room at the Upper East Side restaurant Daniel, being feted by Peter Olson, chief executive of Random House Inc., and a cast of 31 other media lights.
Who was there? Most notably, Joel I. Klein, the 53-year-old Assistant Attorney General who heads the Justice Department’s antitrust division and who is spearheading the Government’s antitrust case against Microsoft Corporation....
Joel is just following the American way - use government service to enrich yourself and your friends.

Here's another story on Middelhoff's fall:
Former Bertelsmann boss sent to jail for embezzlement
On Friday, Mr. Middelhoff’s plunge from the top of the European business world ended with a hard landing when a German judge sentenced him to three years in prison for embezzlement and tax evasion. Despite his plans to appeal, the incarceration began immediately. The judge ruled that there was a risk Mr. Middelhoff might flee and ordered him held at least until another hearing some time in the coming week. Mr. Middelhoff, 61, was accused of misuse of corporate funds by, among other things, taking private trips on chartered aircraft while serving as chief executive of Arcandor, a German department store retailer that had hired him to try to restore profitability. Arcandor, whose Karstadt department stores are a familiar sight in German cities, later filed the German equivalent of bankruptcy, though many stores continue to operate under new ownership.

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