For more than a decade to 2015, Houston-based Quantlab was a slot machine that generated more than $3 billion in accumulated profits through exclusive high-frequency operations, which in a few days accounted for 3% of the volume of the New York Stock Exchange.More than 70%, of those profits went to founder Wilbur “Ed” Bosarge, or to the trusts he controls.
Quantlab co-founders Bruce Eames (24%) and AndreyOmelchenko (with 4%) They now sue 81-year-old Bosarge for fraud (he denies his accusations).Bosarge also faces a fraud lawsuit from the founder of a Stem Cell Clinic in the Bahamas that he financed, took and won several remedies – because, he said in a deposition – “bad ankles, bad knees skiing, muscles that were pulled at him.have a hard time and you have to deal with it.
But Bosarge’s most notable legal war, so it shows how the US state is not going to be able to do so.But it’s not the first time He accepts as true legislation that increasingly protects the rich, it is with his wife, Marie, a 66-year-old former Marilyn Monroe impersonating artist who married in 1989.In the summer of 2017, when Marie was in London to finalize the finishing touches to her new notebook, a $45 million Georgian mansion in the multimillion-dollar port of Belgrave Square, Ed passed her divorce papers.Mary says she was surprised. Yes, he said, he was aware of Ed’s Russian mistress, 20, but assumed that Ed would consider it too expensive to divorce because the couple did not have a prenuptial asset contract and Texas is a state of network assets, that is, everything he wants.won during their marriage, adding up Quantlab.Array’s earnings would be stopped together.
Marie claims she owes her a billion or more, even though she tells Forbes she would settle for less than $100 million.”I’d be happy. Pay my expenses and get on with my life.”
Forbes estimates that Ed Bosarge is worth at least $1 billion, but as he and his lawyers say, the genuine real estate assets of the couple’s network in general only $25 million, as a variety of trusts own not only their Quantlab shares, but also their homes in Houston.Aspen, London and Maine and the 72-acre island in the Bahamas where they moored their 3 yachts (owned by the trust) Array by adding the Marie of the same 180-foot name, with a grand piano.After the divorce papers were handed over, one of the Trusts even republished ownership of a $1.9 million diamond necklace (purchase price) that Marie says Ed gave her as a Christmas present in 2009.”It is not a gift, which in particular was purchased through the trust.It’s an express investment,” Ed insisted on a deposition last year.
“He’s getting old, they gave him a new pony and he doesn’t need to appreciate who brought him here.”
After the failure of mediation and the endless hours of statements and hearings, the divorce was brought to a jury trial in Houston in April, and then in Covid-19, while Marie says that the $20,000 a month in marital aid she receives are being transferred to her lawyers and that she cannot keep fighting, not even having her front teeth repaired.”I have 4 teeth that I broke at a very young age in skating.The bridges are getting in a position to pass out.It has to be done.”
She has managed to make her case a prominent cause among women’s rights activists in Houston.On a hot Saturday in July, a dozen protesters piled up on the corner of the North Boulevard mansion, with symptoms calling for “Justice for Mary.”
“It’s a women’s rights issue,” says Cynthia Cole, a protester who is also the local head of the American Federation of State, County, and Municipal Employees.”He’s getting old, he got a new pony,” she says, and she doesn’t need to appreciate who brought him here.”
But the case has broader implications, beyond divorce. At the heart of the Bosarges fight are 3 techniques used through the rich for their wealth of (among other threats) tax collectors, creditors, disgruntled business partners and, yes, former long-term spouses.The oldest are offshore trusts, which have long frustrated creditors but have been attacked by the US tax government.But it’s not the first time For more than a decade.
The two most recent and increasingly popular techniques are National Asset Protection Trusts (DAPT) and “accepting as true with decanting”.DAPT allows the rich to invest assets in the U.S., accept as true to themselves, gain advantages, and then protect them long Classical acceptance as true by law prevented a user from protecting the assets from true acceptance if they continued to control the assets and use them to gain their own advantages, and this remains the case in most cases.But other states have competed to accept as true with corporations rewriting their legislation to favor those who own the assets over which they have accounts receivable, hence the expansion of DAPT.
Decanting, on the other hand, is a movement used to adjust the terms of a supposedly irrevocable accept as true by removing the assets from accepting as true with and moving them to a new accept as true with, regularly in a state with legislation that provides maximum coverage and opacity of assets and without state taxes.
“We’ve paid money for everything. I wasn’t worried in any detail; trusted him.
South Dakota has been the highest competitive race to “the absolute back of the well,” says asset coverage attorney Jay Adkisson, who is not concerned about the Bosarge case.For example, it allows assets to be transferred from one that is accepted as true with others without realizing the beneficiaries who would possibly be excluded from the new acceptance as true.It also protects DAPT assets from child aid, divorce, and child support programs, provided those claims did not exist when the Assets were first transferred to the DAPT.In fact, in a recent case in South Dakota, a wealthy Californian woman overcame a lawsuit filed through her ex-husband for which she paid approximately $9,000 a month in child aid in true acceptance in her “South Dakota Is Bulletproof to the Max,” echoes David Slenn, a fiduciary attorney who is not involved in the Bosarge case.
In an overdue deposition last year (among a large number of sealed court documents received through Forbes), Bosarge revealed that he, the beneficiary of South Dakota trusts, has $800 million in estimated assets and $280 million in cash, and likely invested even more in trusts.in the Bahamas, the British Virgin Islands and Malta, marie and her lawyers say.A 2011 alleged report from Bosarge’s workplace family circle that Marie shared with Forbes shows a net worth of $2.263 billion.
John Pavlas, an attorney for Ed Borsage, declined, by email, to “comment on the demonstrable inaccuracy and/or lie of many ‘facts’.”Forbes tried to figure out this story. He stated that he simply did not comment because “virtually all of this data is subject to confidentiality orders in various processes.”Without going into detail, Pavlas called Marie a liar.” Simply, the fact doesn’t help her and doesn’t correspond to her story, so she ignores it and says what she likes.”
Wilbur Edwin Bosarge Jr. was not accepted as true with the baby in the background.He was born in 1939 in Mobile, Alabama, the son of a grocery store manager near Bayou La Batre, known for shrimp fishing.A figure specialist, he studied, implemented mathematics at Georgia Tech, worked for IBM on the assignment of NASA’s Saturn rocket in the 1960s, and earned a doctorate from Brown University in 1969.In Houston, he taught mathematics at Rice University and started a new company, Texas General Resources, where in 1983 (without admitting or denying anything) he accepted a permanent court order prohibiting him from violating the anti-manipulation and fraud provisions of the securities law (the US Securities and Exchange Commission).But it’s not the first time He claimed that he illegally supported the value of the shares of an oil company that sought to exchange for a stake in an oil field.
He then created Frontier Limited, which aimed to use “adaptive popularity of forms” to defeat markets.According to Thomas Bass’s 1999 e-book The Predictors, Bosarge teamed up in 1990 with quantitative industry genius Rafael deNoyo, who temporarily discovered that Frontier had virtually no assets.”We were hired and couldn’t pay the phone bill,” he told Bass.His opinion of Bosarge: “He’s a natural con man.” Bosarge’s partners eventually sued him for looting millions of Frontier dollars.He denied his accusations and reached a acuerdo.la lawsuit in undisclosed terms before the trial in 1994.Frontier appears to have been largely owned by Capital Technologies, which in turn was owned by the African Tudor Trust.
Mary says that when she married Ed in 1989, he seemed broke. “I really enjoyed him for his spirit,” he said. Her original wedding ring was a cubic zirconia and shortly after their wedding, her home in Houston was seized, says Mary. But in 1991, Capital Technologies itself bought an 8,600-square-foot mansion on North Boulevard in Houston’s museum district. where Ed Bosarge still lives. The then satisfied couple moved in and Quantlab was born there nevertheless. “The total space was the office,” Marie recalls, adding that the 3 founders of the knowledge scientist worked on the deck and the pool cabana. .
This mysterious African Tudor Trust? It was created (or settled) in Bermuda in 1983 through Barbara Rattay, Bosarge’s sister-in-law since her first marriage, with (according to Ed Bosarge’s testimony) $100,000 contributed through the law of her sister-in-law and stepmother.They were Ed’s two sons and his first wife, Brigitte.Barbara Rattay is a former member of Namibia’s parliament whose rich circle of relatives has lived in Namibia for generations.Because it established the assets of the African Tudor Trust, experts say, acceptance as true with away from Bosarge’s creditors.Rattay’s Namibian nationality has also moved away from acceptance as a source of income from U.S. tax authorities.
Marie argues that the African Tudor Trust was a sham and that Ed was still in control of accepting it as true and using it as a platform for its long-term business ventures.According to Ed Bosarge’s own testimony, in the mid-1980s he transferred some founded “ideas” for Rattay, who placed them in the African Tudor Trust.This intellectual property, he said in a statement, represented the seeds of what has become Quantlab.In addition, Ed did not earn a formal salary for his paintings in the Quantlab Building.Instead, he said, any refunds he had normally earned were reinvested in the company.
Marie argues that the cumulative price of Ed’s hard paintings, accumulated over years in African Tudor, was in fact the community asset, which is crucial, because all of the following trusts were allegedly created through the Tudors’ African assets.court documents, in 2001, with Quantlab’s largest flow of money, all African Tudor assets were allegedly transferred through Rattay to two new trusts he established, the North Boulevard Trust (located in Texas) and the MAS Trust (Bermuda).Ed and Marie were added as beneficiaries, along with Ed’s children.His son Andrew Bosarge (now 57) was the “trust protector” for the North Boulevard Trust, a special designation that meant he could upgrade the trustees for any reason.
But the reorganization of Bosarge’s trust was only just beginning.He explained it this way in his testimony: “If one is decanted to accept as true in two or two in one, one’s asset can be divided into three.Tax wishes or fundamental desires. According to Marie’s lawyers, MAS Trust assets were used to launch the Etosha Trust, Excalibur Trust, ESD Trust and Exson Trust.Subsequently, the assets of those accepted as true with Trust, South Pacific Trust and Exsontoo Trust.At the same time, North Boulevard’s assets were earmarked for the creation of the Southport Trust (2008) and CapTech Trust (2012).Many of them are now domiciled in South Dakota.
“If you choose to accept as true in two or two in one, the assets of an accept as true can be divided into three.It just depends on the needs.”
CapTech Trust’s founding documents (read in the record in one of Ed’s statements) describe his purpose in this way: “to allow Dr. Bosarge and his circle of relatives to retain the circle of family property, adding antiques and art collection, which are lately owned by CapTech Corp.and benefit from the fiscally efficient gains in the United States.”(This is accepted as true when it began in Texas and was transferred to South Dakota.)
While trusts paid their business expenses and an increasingly luxurious private lifestyle, Bosarge had a relatively modest source of income in their non-public taxes, or at least one assumed copy of the couple’s 2014 joint source of income taxes.The back shows a gross source of revenue of $1.67 million.When he needed money, Ed explained in a deposition, “reapply” himself through a distribution of one of the trusts.Ed stated that he had asked the trust workers to keep $200,000 in money in the safe deposit boxes of his various properties.Infrequently he carried $4,000 in street money.” We’ve paid money for everything,” Marie tells Forbes while having coffee at the ZaZa Hotel in Houston.”I didn’t care in any detail; trusted him.
In 2012, fearing a replacement in the Obama era in legislation affecting offshore trusts, Bosarge made the decision to replace the apartment with the maximum of its asset-rich trusts in South Dakota.(At the same time, according to a first-hand user knowledge, Merrill Lynch and Goldman Sachs ended their relationship with Bosarge, involved in the source of the budget in some accounts.)
While even Switzerland and Luxembourg are now forced through a foreign crackdown on tax evasion through the rich to hand over records of some account holders, little South Dakota has a new foreign magnet for trusts, attracting more than $300 billion in assets.
In her statement, Bosarge claimed that Marie had been aware of the movement of the trust’s assets to South Dakota.Marie continually says that she did not know that trusts were evolving to her detriment; that his firm forged secure documents; and that Ed intimidated her into signing others.Bosarge, in a statement, defended his general practice of not including Mary in discussions on monetary matters: “She has no judgment,” she said.
Marie’s lawyers argue that since the African Tudor Trust contained what was actually her network assets, that is, Quantlab’s profits, built entirely during her marriage, any upcoming acceptance as true in which she transferred will also have to be network assets.. But they admit that they cannot solve it; Last November, a South Dakota court rejected its attempt to download the discovery of key trusted documents, noting in a ruling that, under the State Trusts Act, “…a successor who accepts as a true witness is not guilty separately of the agreements, contracts or traps acquired through his predecessor accept as true treasures”.
This lack of transparency affects the effectiveness of asset hedging trusts.”It’s exclusive. He is not allowed to know,” Marie’s lawyer Bucky Allshouse complained at a hearing in February.”We don’t know what assets went there and whether they’re contributing to network assets or separate assets or whether they were there from the beginning,” he said.”It depends on them to turn out to be a separate property. They didn’t.”
Marie Bosarge is necessarily trapped in a Catch-22: to have some hope of proving fraud in her Texas divorce case, she wants to know what’s in South Dakota trusts.In June, a Harris County Family Court issued a ruling on ignoring 3 of Mary’s claims, while allowing three others to continue, adding the fact that Ed had breached his fiduciary duty to her.The trial is scheduled for November, the pandemic is underway.
The extent to which Bosarge’s confidence reset was intended to avoid taxes and how unclear a network is divided into assets or spouse demands.Joseph R.Valentino, one of Bosarge’s longtime tax attorneys, is being held through the federal government in Houston awaiting extradition.to the Netherlands, where he was sentenced to nearly 3 years for corporate tax evasion.In 2016, Valentino was the director of an acceptance as true with which Bosarge and quantlab co-founders Eames and Omelchenko had trained to control the company.
Co-founders claim in their lawsuit for fraud opposed to Bosarge that they built the company when he “wasn’t absolutely interested in what was happening at Quantlab as long as he kept his yachts afloat.”They’re hunting to get the business or, alternatively, to withdraw their money.The relentless citadel and Virtu festival gradually eroded Quantlab’s advantage.Eames and Omeltchenko say Bosarge sealed a $1.7 billion bid by the company in 2016 (he was looking for more than $3 billion) and then “carried out a tyrannical coup” that drove them out.
Affected by defections, Quantlab bought assets in 2017 from its Chicago-based rival Teza. “What’s left is valuable, but ineffective,” according to Eames and Uthchenko. Bosarge said in a statement in their divorce case that the formula isn’t doing much right now. , but that may change ‘”if you wake up.”
A Delaware Chancellery Court ruling in 2019 found that Eames and Uelchenko did not have the ability under Quantlab’s master documents to expel Bosarge.Co-discoverers still have a separate lawsuit opposed to Bosarge in Texas for fraud, which he denies.suspended due to the pandemic, as well as the legal disorder around the mother mobile clinic.
In 2015, through a Bahamas deal known as Big Bird, Bosarge bought Okyanos, a mother mobile clinic in Freeport, Bahamas, discovered in 2011 through Matthew Feshbach, an investor and developer of mother mobile phones without medical training.A grandmother with Parkinson’s disease got up from her wheelchair and walked again.But debts were piling up: Feshbach had discovered that it was incredibly difficult to get doctors to refer patients to his clinic (paying for referrals is illegal).But Bosarge was satisfied with the help and willingness to check the treatments, revealing in a statement that he himself had won thirteen treatments.
In fact, for more than ten years, Bosarge has supported paintings on targeted mobile stem therapies, and more recently has been proposed as a guinea pig, extracting his own stem mobiles by liposuction, purified and re-injected into challenging areas.”are the way, your own mother mobiles, ” he said in a depot.Bosarge sponsored an annual symposium at the Vatican, after which the church voted for adult mother mobile research.
When Bosarge took over Okyanos, he signed a contract with Feshbach to remain in the paintings for $30,000 a month, and millions more promised for several years, but the deal with Feshbach temporarily deteriorated.According to a lawsuit for fraud and breach of contract law filed through Feshbach opposed to Bosarge in Pinellas County, Florida, the billionaire fired Feshbach after refusing to violate US law.But it’s not the first time And the Bahamas by loading stem cells from Houston to Okyanos without FDA approval or permits.that Bosarge and his team conspired to pay the doctors for the layoffs.
The Bosarge camp responded to the claims with binding arbitration, and the case is now in limbo.On Bosarge’s side, the clinic was destroyed by Hurricane Dorian.Feshbach’s lawyers filed an affidavit from Okyanos’ owner in court claiming that the damage was minimal.opened a home replacement clinic in Houston.A spouse sums up what it’s like to do business with him: “Nobody does business with Ed Bosarge without getting diminished.”
Follow-up of power innovators in Houston, Texas, Forbes journalist since 1999.