Anthony “Tino” De Angelis was born in 1915 in the Bronx. After leaving school to work for a butcher in a meat market, he joined a large meat processor, the Adolf Gobel company. He worked his way up to become its president in 1949, but the company was soon forced into bankruptcy as a result of a scandal in 1952 that involved overcharging the US government $31,000 ($274,000 today) for substandard food. De Angelis quickly moved on to start another business, the Allied Crude Vegetable Oil Refining Corporation, which he set up in 1955.
What was the scam?
De Angelis decided to corner the market for soybean oil, buying up huge amounts of the physical commodity, as well as soybean futures, in order to profit from any price rises. To get the necessary funds to do this, as well as keep paying his staff, he borrowed large amounts of money secured against the salad oil in his company’s storage tanks (which were guaranteed by American Express). However, unknown to outsiders, the tanks were partly filled with water, giving an inflated view of the reserves. De Angelis also stole blank receipts from American Express and started forging his own receipts.
What happened next?
Initially the firm’s buying pushed prices higher, helped by speculation that the US was about to agree a trade deal with Russia that would involve the export of large quantities of soybeans. However, when talks on another agricultural trade deal collapsed, the soybean price plummeted. This left Allied Crude Vegetable Oil with huge losses in the futures market, forcing it to declare bankruptcy in November 1963. When the receivers came in to investigate its assets, they discovered the scam. De Angelis was arrested, and later sentenced to twenty years in jail.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Lessons for investors
The scam destroyed two brokers, Williston and Beane, and Ira Haupt and Co, who had lent money to De Angelis. Both sold to competitors for a pittance. American Express also had to pay $150m ($1.25bn today) to cover guarantees on Allied’s oil. The whole debacle shows the importance of proper due diligence on any investment. Even after American Express was tipped off about possible fraud, it still allowed Allied to audit its own tanks. Amazingly, investors would allow themselves to be conned out of $7m ($33.2m today) by another Ponzi scheme that De Angelis ran after he was released from jail in 1972.
-
8 of the best houses for sale with outdoor swimming poolsThe best houses for sale with outdoor swimming pools – from a family house in Wimbledon Village, London, to a 1640s mansion in Derbyshire with a heated swimming pool in the grounds
-
Trouble brews in B&M as bargain shops take a hitOpinion Once a stock market darling, B&M's share price has slumped. What has gone wrong for bargain shops?
-
A cyclical case for UK stocksOpinion Depressed margins and relatively low valuations mean the UK market could rally strongly as conditions improve, says Cris Sholto Heaton.
-
Infrastructure investing: a haven of stable growth amid market turmoilFrom booming construction in emerging markets to digital and green transitions, the infrastructure sector offers security, returns and long-term opportunities
-
The costly myth of “sell in May”Opinion May 2025's strong returns for US stocks have once again shown that putting too much weight on seasonal patterns will only make investors poorer, says Max King
-
Who’s driving Tesla?As Elon Musk steps back from government with his eyes on the stars, investors ask if he’s still behind the wheel at his electric-car maker.
-
Investment opportunities in the world of Coca-ColaThere is far more to Coca-Cola than just one giant firm. The companies that bottle and distribute the ubiquitous soft drink are promising investments in their own right.
-
Streaming services are the new magic money tree for investors – but for how long?Opinion Streaming services are in full bloom and laden with profits, but beware – winter is coming, warns Matthew Lynn
-
'Pension funds shouldn't be pushed into private equity sector'Opinion The private-equity party is over, so don't push pension funds into the sector, says Merryn Somerset Webb.
-
Greg Abel: Warren Buffett’s heir takes the throneGreg Abel is considered a safe pair of hands as he takes centre stage at Berkshire Hathaway. But he arrives after one of the hardest acts to follow in investment history, Warren Buffett. Can he thrive?
