This is the third and final installment in my series on Crazy Eddie, the New York area electronics retailer that became a criminal empire. Part I, explaining how the company got started, is here. The continuation, Part II, involving the beginning of the end of the scam, is here. And now, the conclusion. The main source material for this article is the fascinating series of essays on Crazy Eddie by Sam E. Antar, one of the participants in the scam, who now works as a forensic accountant.
The Crazy Eddie electronics company, which had by 1987 bilked millions from investors who greedily bought its overinflated stock, in that year met its Waterloo. After suffering a hostile takeover, the new owners were bound to discover the company was built on large-scale fraud–and they soon did. An inventory of Crazy Eddie’s assets came up $40 million short. Eddie Antar and his clever cousin, Sam E. (Sammy) Antar, had used all sorts of audacious accounting tricks to make it look like the company was doing gangbusters business, when in fact sales were declining. As soon as the new owners realized they’d bought a lemon, a flurry of litigation and government investigations began. It was soon to turn into a blizzard. Crazy Eddie was finally coming down.
As it turned out, the Feds were already investigating the company, but they didn’t realize that their own investigation was essentially a weapon by one branch of the Antar family against the other. The rift went back to the “Battle of New Year’s Eve” incident in 1983. To get revenge on Eddie, Sam M., the original founder and several other relatives used two disgruntled Crazy Eddie former employees as whisteblowers, who told the SEC (Securities and Exchange Commission) a carefully-edited story that pinned all the wrongdoing on Eddie, Sammy and others in their faction, completely ignoring their own complicity. In early 1989 Sammy learned about the original SEC investigation. He also caught on that Eddie, who was carefully papering his overseas bank accounts in anticipation of fleeing the country, was about to cut him loose. The ship was sinking, and everybody was scrambling for anything that would float.
Eddie Antar’s wanted poster, courtesy of the FBI, circa 1990. Would you buy a used TV from this man?
Sammy tried to cut a deal with the investigators. But there was one problem: they didn’t believe him, because he’d already lied to them repeatedly during earlier phases of the investigation. It took Sammy a long time to convince the feds that the information he was now giving them was the truth, and that the previous investigation had deliberately led them down the wrong path. Eddie Antar had by now skipped town and was living in Israel. Crazy Eddie itself was finally going down. The new management thought they could keep the company going, and even filed for Chapter 11 protection (a form of bankruptcy that would, if successful, have seen the company survive and reorganize), but by Christmas 1989 it appeared futile. Sales were down and the stores’ shelves were bare because suppliers didn’t want to do business with the tainted chain. The last Crazy Eddie stores closed for good at the end of 1989.
In June 1992, the law finally caught up with Eddie Antar, alias David Cohen. Sammy’s testimony, in part, helped investigators trace Eddie’s Israeli bank accounts and other ill-gotten gains. He was extradited to the United States in early 1993 to stand trial.
You couldn’t imagine that a story like this wouldn’t end with a courtroom scene. The Crazy Eddie criminal trial in summer 1993 didn’t disappoint. The courtroom was packed and there was a lot of drama. Eddie and his brothers who were also on trial tried to blame Sammy for the entire debacle. Over several days of sensational testimony, Sammy laid out what had gone on during the 1970s and 1980s, from insurance fraud to paying employees off the books, and finally to the large-scale fraud and stock pumping that ultimately wrung $80 million out of gullible stock investors. Others who testified against Eddie and the brothers included Debbie, Eddie’s wife and participant in the Battle of New Year’s Eve, who told stories of Eddie stuffing wads of cash under the bed or wiring it secretly to Israel.
In this 1989 courtroom sketch, Eddie Antar gives a pep talk to investors in Crazy Eddie T-shirts. Little did they know that their money was secretly being siphoned to Israel and other exotic places.
On July 20, 1993, two of the three defendants, including Eddie Antar, were found guilty. There was a long series of appeals where the verdict flip-flopped throughout the 1990s, ending in guilty pleas, but ultimately Eddie Antar was sent up for 8 years and charged $150 million in fines. This doesn’t count the staggering civil judgments against him that continued to rack up throughout the end of the 1990s and the 2000s. Sammy, though he turned state’s evidence, did not get off scot free. He was sentenced to house arrest and ordered to pay fines and restitution, but avoided prison time. Sammy himself was surprised by this unexpectedly lenient result. He wrote later that he felt no remorse for his crimes and his plea deal was purely to save his own neck. Had he not been caught, he said, he would still be scamming today. Morality never entered into it.
Eddie Antar eventually got out of prison. Incredibly, in 2001 he tried to reboot the company as an Internet venture, and even hooked up again with Jerry Carroll, the loud pitchman who had made the company a household word in the 1980s. The venture didn’t catch fire this time and sank again. You can’t bottle lightning twice. Edward Antar died in September 2016 in Ocean Township, New Jersey.
Crazy Eddie’s loudest, most indelible commercials were at Christmastime. Here’s another one, circa 1986 or 1987.
I started this series with my own recollections of the bizarre Crazy Eddie TV commercials from the mid-1980s. It’s amazing how indelible things like that are in one’s mind, even 35 years later. Few knew that behind the scenery-chewing pitch man throwing snowballs at the TV was both a crime story and a family drama that played out so many cultural motifs of that era: unbridled avarice, the American dream gone wrong, and the sacrificing of one’s personal morals for the glittering allure of profit. The Crazy Eddie saga is fascinating to read about, but many things about it make us very uncomfortable, and they should. Crazy Eddie is part of history now, but the fine line between business and crime remains, even in our own day, maddeningly thin.