Contact: John Klotz Return to Klotz Law Homepage

Forbes Magazine: The Return of John Peter Galanis (for awhile)

John Peter Galanis was a wunderkind of swindlers from the late sixties right up until mid-eighties. Although sentenced to a 27 year prison term in 1988, according to the  September 18, 2000 edition of Forbes Magazine, the stretch in prison was merely a bump in the road.  Forbes  says that Galanis just kept on going - from his prison cell. He took his lickin' and kept on tickin.'

That was September 2000. After the Forbes item appeared Galanis apparently walked away from his half-way house in Manhattan and his ostensible employment at a fashionable Eastside restaurant. Whereabouts and assets unknown. Then he surfaced again and was briefly back in custody. Now released from what once once a record breaking incarceration for "white collar" crime, at last report he was viewing life from a penthouse apartment of an exclusive San Francisco hotel.

You can read about his prison escapades in  Forbes, but to me it's an old story. Across four decades, Galanis has left a trail of defrauded investors and shuttered banks that is truly remarkable. As fortune would have it, I am one of the few attorneys to have ever recovered substantial amounts for investors cheated by Galanis. In 1986, a Galanis attorney bitterly remarked that I "was the one who put my client [Galanis] out of business." In 1988, when Galanis was sentenced, a reporter from the Philadelphia Inquirer said that I was "the one who put him away."

There hangs a tale.

The Saga of Armstrong Capital

Armstrong Capital was an off-shore mutual fund that was looted by it promoters, Akiyoshi Yamada and John Galanis. Eventually judgments totaling $1.8 million dollars were obtained by Armstrong's attorneys but all efforts to collect on the judgments were fruitless. In 1984, I was retained by Citibank on behalf of Armstrong to collect the judgments.

At one point, I was called as an expert witness on Galanis's overseas money-laundering by the Internal Revenue Service which had filed an action against his wife in Miami, Florida.

At that time Galanis was in an involuntary bankruptcy. To settle the bankruptcy, he made an offer of ten cents on the dollar to all his creditors but Armstrong declined. Against strenuous opposition, we were able to collect the remaining proceeds of the bankruptcy and then enforce a lien against his Greenwich Connecticut mansion whose title had been protected by a wall of nominal title holders.

Approximately $2.5 million dollars was recovered.

Gerstl v. Galanis et al
Reply Post-Trial Memorandum. Galanis vigorously resisted Armstrong's attempts to claim funds left in the account of the temporary trustee when the involuntary bankruptcy was dismissed.

In re Galanis
71 BR 953 (D. Conn., 1987) Armstrong won.

Behind the project, a man protected by a maze
Philadelphia Inquirer
Sunday, June 15, 1986
The bankruptcy involved Galanis's efforts to build a cable-TV empire. After that, Galanis moved into tax shelters. The Inquirer expose was the beginning of the end. Eventually, he would be indicted and convicted of securities frauds.

Investigative Expertise
In 1987, a trial attorney for the IRS in Miami Florida had occasion to write NYS Governor Mario Cuomo's office concerning my assistance in tracking Galanis family assets.

Contact: John Klotz Return to Klotz Law Homepage