Two faces of Trevor Cook

  • Article by: DAN BROWNING , Star Tribune
  • Updated: February 3, 2010 - 9:30 AM

Investors trusted him with millions, but the government says he blew their money. He racked up huge gambling losses, hosted drunken parties in his mansion and lavished cash on exotic dancers.

On a bathroom wall in his office building, Minneapolis investment adviser Trevor Cook displayed a framed newspaper clipping touting his astute global currency trading.

Around it, he placed sketches of mob bosses John Gotti and Al Capone, and tough-guy actor Al Pacino from his roles in the gangster movies "Scarface" and "Carlito's Way."

The mini-gallery offers a glimpse into the man who now sits in jail accused of running a $190 million fraud scheme.

Cook, 37, appeared to be a successful businessman with an international portfolio. He persuaded about 1,200 people to invest with him, including many who heard of his trading scheme from Christian and conservative talk-radio shows. Yet for years, Cook had another life -- filled with out-of-control drinking, gambling, bookmaking and allegations of defrauding investors. Friends and associates say he spent lavishly on booze, luxuries and strippers, and for a time employed a former exotic dancer as his assistant.

Thomas Brueckner, an investment adviser and talk-radio host, decided against joining Cook's network of money managers last year because he said no one seemed to care about background checks, which made him nervous. "It was like, everybody's welcome .... It didn't matter what you had on your criminal record," Brueckner said. "This whole thing just seemed to be populated with people who liked playing near the line."

To investors, though, Cook presented the image of a knowledgeable and successful adviser. His office in the third floor of the fortress-like Van Dusen mansion in Minneapolis -- which everyone called "the castle" -- had a bank of computer monitors streaming market updates. They flashed green every time Cook's trades supposedly made money. And if anyone doubted his track record, he could show them a letter from a California lawyer who supposedly documented his firm's more than $4 billion in assets under management.

Cook declined to talk to a reporter and invoked his right not to incriminate himself when federal regulators subpoenaed him to testify about where investors' money went. A federal judge cited Cook with contempt Monday and ordered him jailed until he helps a receiver recover investor money and some luxury goods allegedly purchased with it.

As he built his business over the past eight years, Cook drew attention from regulators, law enforcement and plaintiffs' attorneys several times. Cook always managed to dodge problems and keep going. Until now, it's been the story of his life.

Taunted as a youth

Born the second of four boys, Cook for years endured childhood taunting over a puffy, purple birthmark on his face.

After more than a dozen surgeries to remove it, Cook suffered a hockey injury in high school that split open his face, leaving him with a disfiguring scar, said Alex English of Otsego, Minn., a friend since second grade.

Cook, his three brothers and their mother moved to Minnesota from California in the mid-1970s after the parents split up. Public records suggest they had never married. His mother, who was a devout Christian, met and later married a Lutheran minister in south Minneapolis, where they settled down. Cook's stepfather went into business, owning a cooling company and rental property, and took jobs substitute teaching and working with the disabled, while his mother worked in a video store, said Cook's brother Monte.

Though money was tight, Trevor Cook attended high school at the Minnehaha Academy, a private Christian school. As a teenager, he got a job caddying at the Minikahda Club overlooking Lake Calhoun, where he met wealthy members who influenced his career. He won an Evans Scholarship, awarded to caddies at private golf courses, and in 1990 enrolled at the University of Minnesota.

His drinking soon got him into trouble. At a residence for the U's Evans Scholars, Cook roomed at one point with Jason Sullivan, who tried to be a good influence. "He just was an absolute partyer," Sullivan recalled. "There was one occasion where he actually woke up at night and urinated all over six pairs of my shoes."

In 1991, Cook took Sullivan's driver's license and savings book, and paid a kid who resembled him $500 to withdraw $2,500 from Sullivan's bank account, according to Sullivan and records from a subsequent investigation by futures industry regulators. Cook didn't dispute the theft, the records say.

Cook's stepfather died of colon cancer in 1995 and his mother, distraught and in debt, killed herself four months later, overdosing on his leftover medications. Six weeks after his mother's suicide, Cook got his first of several drunken driving tickets. In 2002, Cook's older brother, Jason, a pharmacist with a history of drug abuse, died of an overdose.

Monte Cook has fond memories of Trevor. "I know growing up he did something every year. He made a hockey rink in our back yard. He made a ski jump. He made a golf course. It was really fun growing up with him," Monte said. But he said they grew apart as adults. Until recently, "my brother Trevor hadn't came over to my house in 14 years," he said.

Prospecting for the gold

After high school, Trevor Cook delved into the world of gambling.

"When he was in college he was a bookie," said his friend English. He said Cook collected from bettors when they lost, "and he always paid" when they won. Cook also handicapped sports events, offering tips on some 900 phone lines he owned, and he maintained accounts for a Las Vegas sports information service, according to one of his old résumés.

Cook boasted on the résumé that he was "Able to handle pressure and work in a crisis environment." Monte Cook and others said his favorite movies were "Boiler Room" and "Wall Street," from which he quoted at length.

Several associates who worked recently with Cook said he continued to wager, and regulators have identified $4.8 million in gambling losses.

Investors got a different story. Cook said in a radio interview last March that he relied on mathematics and statistics to avoid uncertainty. "And simply put, we're just not gamblers," he said.

Associates say Cook does have a knack for numbers. He graduated in 1998 from the university with a bachelor's degree in applied economics.

He landed a sales job in December 1997 with Investment Rarities Inc., a Minneapolis trader of gold, silver and other precious metals, where he met several people who years later would join him in his investment firm. English also worked at Investment Rarities.

Cook joined a Maple Grove investment firm in 2001, and married his high school sweetheart the following year. But he soon got into trouble with futures regulators for allegedly cheating elderly clients and putting their money at risk. The FBI seized his office computer in 2003, but nothing came of the investigation.

Next, Cook went to work at Universal Brokerage Services, a Burnsville money management firm supposedly owned by a friend. But Cook actually owned the business, according to a sworn statement he filed in a lawsuit. Cook needed his friend's registration to trade in futures and options, a former associate explained.

His investment group began offering a program that he said made a profit in the currency markets. The group claimed that Islamic banks helped finance currency trades, making the deals all the more lucrative because sharia law forbids charging interest. Promising returns of 10.5 to 12 percent, Cook's group pitched the investment on a Christian ham radio network and on 200 radio stations that carried Pat Kiley's talk show, "Follow the Money."

Cook paid $2.6 million in cash for the 117-year-old Van Dusen mansion in 2007 and began recruiting clients at investment seminars.

Brad Johnston, who owns a financial advisory firm in Minneapolis, attended one seminar at the request of a client. Cook followed some associates to the podium and made a short, low-key pitch, Johnston said. About 10 mostly young sales associates waited eagerly at the back of the room to meet prospects, he added. "It was like a scene right out of the 'Boiler Room,'" he said, referring to the 2000 movie about unscrupulous stockbrokers. Johnston steered his client away.

Investors hand over money

The money began rolling from investors, mostly retirees looking for modest returns.

Cook bought exotic cars, a $9,000 exercise machine, elegant watches and jeweled eggs made by the House of Fabergé during the late 1800s and early 1900s, according to federal regulators.

His associates say he also continued to bet heavily. In a sales room in the Van Dusen's basement hung a fake edition of Casino Player magazine featuring Cook on the cover.

Cook regularly patronized strip clubs, sometimes dropping more than $10,000 a night, according to a former coworker and English. "Oh, 10, 15 grand easy," English said. "Yeah, I was right there with him. It was all just for fun."

Former dancer Itona Onoue said she was working at Rick's Cabaret in downtown Minneapolis when Cook came in one night in February 2008. She said he hired her as his administrative assistant and they had a "physical relationship."

"My desk was probably like 30 feet away from him," Onoue said. Her duties included making booze runs for Cook and his pals, spending up to $1,000 every week or two, she said. Onoue said she quit last fall in the wake of investor and regulator lawsuits. She said Cook has since invited her back, but she declined.

"Because I know what's going on at the castle," Onoue said, "like his hard-core parties, like his drinking, to like the dancers and then the prostitutes and stuff like that. And I didn't want to be involved in that."

Cook supported his brother Graham, Monte's twin, putting him to work as a computer tech in the mansion, where he slept in a tiny room in the basement.

For several years, Trevor Cook traveled widely, often on business to Switzerland, Dubai and Latin America. He paid more than $12 million for land in Panama City, Panama, where he and others once planned to build that nation's largest hotel-casino complex and a condominium tower.

But Cook's luck seemed to run out in late June, when the U.S. Securities and Exchange Commission (SEC) subpoenaed his business records. His problems became public a couple of weeks later when nine Ohioans filed a federal lawsuit in Minneapolis saying that Cook and his associates wouldn't return nearly $5 million placed in the supposedly liquid currency investment.

The SEC and the Commodities Futures Trading Commission filed parallel lawsuits in late November accusing him of running a Ponzi scheme, which led a federal judge to order the seizure of Cook's assets -- including the land in Panama. Regulators say at least $130 million in investor funds was lost, and they want Cook to say what happened to more than $35 million that seems to have vanished.

William Mauzy, Cook's attorney, said at a hearing last week that he expects a federal grand jury to indict Cook in a month or two.

English said Cook maintains his innocence and would like to talk, but he's taking his attorneys' advice to keep his mouth shut.

"Trevor's stance is this: He feels like he did a good job for his clients and did a good job trading and is willing to stand up and defend himself," English said.

"But he's upset. He's on the defensive now because he's being attacked by so many people from so many different directions. ... At this point I think he's so angry that if he has the money, I don't think he has any intention of giving it back."

Dan Browning • 612-673-4493

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