Embezzler to the Stars
The Jewish History Series - Lesson #7
David Begelman, Embezzler to the Stars
In February of 1977, actor Cliff Robertson, an established star with an Oscar and an Emmy, and impressive hits like PT 109 and Obsession on his resume, received a Form 1099 from the IRS that said he had received $10,000 from Columbia Pictures for an alleged promotional tour which he never made. He had never received the money, and he had his accountant call up Columbia to ask what was going on.
He got no answers. All summer long he kept trying to find out what the story on the 1099 form was, and he was put off with vague reassurances that "the matter was being taken care of." He also received some quiet advice from a number of friends and Hollywood insiders who clearly had some previous idea of what was going on: shut up, pay the IRS and forget about the whole thing. But Robertson got his dander up and said, "Bull! I'm not paying taxes on $10,000 that I never received!"
Eventually Robertson was able to force Columbia pictures to show him the canceled check for the alleged $10,000 payment, and upon seeing it he discovered that his signature had been forged. Robertson's report started an investigation. The LAPD and the FBI verified that the $10,000 check was a forgery, and they tracked it to David Begelman, Columbia Pictures' flamboyant Jewish president who was credited with being the producing genius behind Steven Spielberg's Close Encounters of the Third Kind. Begelman had forged Robertson's signature and cashed the check himself.
Columbia Pictures, forced to launch their own internal investigation, discovered a series of forged checks, bogus "consulting" contracts, and elaborate schemes to defraud the company by Begelman, including a number of forged checks which he had cashed, pocketing the money and using it for things like building a luxurious private screening room in his home and taking Caribbean gambling-junket vacations.
Begelman forged and cashed checks in the names of an odd assortment of real persons, from a prominent Santa Monica architect to the maitre d' at a popular Beverly Hills restaurant, none of whom knew that Begelman was using their names to loot his own company. Officially, Columbia finally admitted that Begelman had embezzled about $75,000, but the true extent of his defalcations has never been revealed to this day, and the actual total is believed to be much higher.
Begelman was summoned to a meeting of the board of directors in New York and politely asked to explain himself. These men were all Jews like himself, including CEO Alan Hirschfield, senior vice presidents Allen Adler and Dan Melnick, comptroller Joseph Fischer, and majority stockholder Matty Rosenhaus, aged 65, who was married to a former Miss Israel 40 years younger than himself.
The performance that Begelman put on for the board, complete with sad violins, would have done credit to one of his own movies. Begelman claimed amnesia at first, swearing that he didn't remember forging any of the checks or taking any money, and when that got a little too thin he literally pleaded insanity, trotting out his psychiatrist to claim that he (Begelman) had embezzled the money because of his low self-esteem. (This was a man who was rarely seen without at least two or three thousand dollars' worth of clothing on his body and expensive jewelry to match.) As his ace in the hole, Begelman even staged a couple of melodramatic hysterical breakdowns in the boardroom, on one occasion running to a window and threatening to jump out of it.
Because Columbia Pictures was a publicly traded company and among other things, publicly traded companies are not allowed to have self-admitted thieves in charge of them, Columbia eventually bowed to the inevitable, and in September of 1977 placed Begelman on leave of absence while going through the motions of an "investigation"--fully salaried, of course. In December of 1977, they reinstated Begelman as studio head, claiming that his embezzlement and forgeries were prompted by "emotional problems" that, "coupled with ongoing therapy, will not impair his continuing effectiveness as an executive."
Robertson and his actress wife Dina Merrill were outraged and wondered how, especially in the immediate post-Watergate era, a crook could maintain his position of power.
What is interesting is the reaction of the almost entirely Jewish hierarchy at Columbia pictures to the revelation that the head of the studio was a thief, as well as the largely kosher Hollywood establishment. Tinseltown rallied around Begelman as if he were a persecuted saint, and everyone from members of Columbia's Board of Directors to Hollywood columnists like Rona Barrett gave 110% to make sure that Begelman not only never saw the inside of a jail cell, but retained his job and his salary and his privileged position of power in the movie world as if nothing had happened.
Columbia itself never used the ugly words "embezzlement" or "forgery" in any press release or comment on the case; "unauthorized financial transactions" was the closest they would come to the truth.
One of Hollywood's responses was to make Cliff Robertson's life a living hell and effectively to blacklist him from working in pictures. Producer Ray Stark called Robertson and told him that if he continued talking to the press Begelman would be driven to suicide. Robertson said that he would do "what a citizen should do in this situation." Robertson and his young daughter subsequently received threats of a sufficiently credible nature so that they were provided with police protection.
Despite the pressure, Robertson decided to speak out. He got his story to the press through his wife, Dina Merrill, and spoke to Washington Post. In 1978 Hollywood gossip columnists published the affair and dubbed it "Hollywoodgate". There were also a number of deep-ranging and documented articles on David Begelman's shady past, including his notorious stint in the 1960s as agent and manager for the drug-addicted and trashed-out Judy Garland, a financial relationship which degenerated into threats, accusations of embezzlement on Begelman's part and perversion on Garland's, and lawsuits which made spicy and engrossing reading.
It appeared that far from being an aberration brought on by "emotional problems," Begelman's behavior was part of a lifelong pattern of criminality and dishonesty.
Eventually the SEC put its foot down and forced Begelman to resign from Columbia. He pleaded guilty to a slap-on-the-wrist charge in one single courtroom appearance and then went on to work for Columbia as an independent producer, as well as running United Artists for MGM in the 1980s. Later he ran two smaller production companies.
David Begelman finally followed through on his repeated threats of suicide and shot himself in a Los Angeles Century Plaza Hotel room in August of 1995. The story of the Embezzler to the Stars is told in David McClintick's 1982 bestseller Indecent Exposure: A True Story of Hollywood and Wall Street (New York: William Morrow and Company). Of the Robertson's fate, McClintick writes, "Cliff Robertson was blacklisted for four years after reporting David Begelman's forgery."
A glance at Robertson's filmography on the Internet Movie Database shows that his career never fully recovered. Whereas once he had played leads in films like PT 109, Obsession, and The Great Northfield Minnesota Raid, after 1978 he lapses into the lowest budget of grade B flicks and even television soap operas. Robertson's latest role was a bit part as Uncle Ben in Spiderman. Robertson paid a hefty price indeed for being a Gentile who refused to allow himself to be robbed in silence by a Jew.