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BUSTED
Alexander Wolff
August 04, 1997
John Spano's giddy run as an NHL owner ended quickly amid charges of fraud and deceit
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August 04, 1997

Busted

John Spano's giddy run as an NHL owner ended quickly amid charges of fraud and deceit

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In retrospect it's apt that Michael Rudman first met John Spano on Halloween night, for that's when nobody is quite as he appears.

Rudman, a longtime New York Islanders fan and habitué of the skyboxes in Nassau Coliseum, took an instant liking to Spano, the Dallas businessman who was negotiating to buy the floundering team from owner John Pickett last year. Rudman appreciated how Spano would invite him into his box and ask advice. "He was like someone who'd been given a new toy and was having fun with it," Rudman says. "He was on a big high. He was flying his private jet back and forth from Dallas, and he talked about how much he was spending on fuel."

Over the ensuing months Rudman continued to see Spano plying the pile of the owner's box. But soon after the NHL's Board of Governors unanimously approved the sale on Feb. 24, Rudman began to notice a change in Spano. "He was a little less friendly," Rudman recalls. "The last time I saw him was on April 9, when the team played Montreal. He didn't seem to be as relaxed as he had been. He seemed to be far away, in another world."

He had good reason to be. Two days earlier Spano had apparently closed the $165 million deal to buy the team. He handed over $80 million, secured through a loan from Fleet Bank, with no problem. Spano was also supposed to give Pickett $16.8 million, the first installment for the cable TV rights that made up the $85 million balance of the agreement. Only he didn't—and Pickett, to his everlasting regret, chose not to postpone the closing. Instead he took Spano's sword that he and his lawyers had instructed Lloyds Bank in London to wire the funds, supposedly withdrawn from a trust set up for Spano by a late relative, and that the payment was on the way.

Pickett would never, to adapt a phrase, be shown the money.

On July 17 federal authorities charged Spano with bank and wire fraud, citing among other things a letter from Lloyds signed by a senior vice president named Clive Jones in the trust department confirming the existence of a $107 million trust. The bank claims that it does not employ anyone by that name in that position. If the story laid out by the feds is correct, the look Rudman saw on Spano's face at that Islanders-Canadiens game betrayed what Spano must have by then come to realize: His run as ubiquitous ingratiator and brazen joyrider, as Forrest Gump and Ferris Bueller rolled into one, was coming to an end.

On July 21 authorities appearing at Spano's Dallas home and office with a warrant for his arrest came away empty-handed because he was in the Cayman Islands, and for a fleeting moment it looked as if the sports world might have its answer to fugitive financier Robert Vesco. But the 33-year-old Spano surrendered to authorities on Long Island two days later, and at Spano's arraignment Joseph Conway, an assistant U.S. attorney for the Eastern District of New York, outlined what he called "a tangled web of lies and broken promises" that Spano had spun, using fudged faxes and claims of assets. Conway said his office will seek a conviction that would likely land Spano in prison for at least three years. Spano wasn't required to enter a plea at the arraignment, but his lawyer, Nicholas Gravante Jr., said Spano intends to plead not guilty to all charges.

Back on Halloween night, as the Islanders were losing 5-3 to the hapless Toronto Maple Leafs, many of the 7,719 fans in the half-empty Coliseum began chanting, "Help us, Spano!" For the more than three months that Spano actually owned the Islanders, he blew into town on corporate jets, conveyed himself in chauffeured limousines and bivouacked in sumptuous hotel suites. General manager Mike Milbury spoke excitedly about spending Spano's millions on free agents.

His new station in sports was of a piece with his apparent profile in the business world. To hear Spano tell it, the leasing business he owned, Bison Group, encompassed a worldwide empire of 10 companies and more than 6,000 employees. He and his wife, Shelby, lived in a paid-in-full, $3 million Tudor home in Dallas's tony University Park, and Spano also owned a house in the Hamptons. He didn't own just a Learjet; he had a Gulfstream, too. "I've owned every great car that was ever made," Spano told SI as recently as July 20. "I have the houses and everything else. I felt I was experienced enough to be able to take [a hockey team] head on."

Spano's multimillionaire image began to erode under the scrutiny of Newsday, which in a series of stories last month put the lie to many of his claims to wealth. Turns out that the jets were chartered, possibly with the Islanders' money. Turns out that property records in the Hamptons show no evidence of a house belonging to anyone named John Spano. Turns out that Spano not only carries a $1.8 million mortgage on his Dallas home but is also $85,000 in arrears on property taxes and only three weeks ago bounced a check written to cover that amount. Further, any person who believed that Spano headed up a multinational conglomerate worth millions was being buffaloed: At Spano's arraignment, when U.S. magistrate Judge Viktor Pohorelsky tried to identify assets that the defendant could pledge against his $3 million bail, Gravante told the court that Bison Group held "nothing appreciable" in value. Spano posted bail on Monday using his Dallas home and his parents' and his sister's homes as collateral.

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