Addicted to giving

Please don’t think I am showing off, but I have decided to give twenty million pounds to my local cinema, provided they put my name up in lights above the popcorn counter.

What’s more, I am giving £15m to my old comprehensive school, by way of thanks. And – let’s see now – how about £10m for the local GP surgery?

If I ever get my hands on such riches, I promise to write the cheques at once. In the meantime, regrettably, they’ll have to make do with the pledge. That’s what some of the world’s greatest arts organizations are doing now that Alberto Vilar, one of the most generous philanthropists of our time, has run out of funds.

Vilar’s gifts and promises included $50 million to the Kennedy Center in Washington, $45 million to the Metropolitan Opera in New York, £18 million to Covent Garden, $20 million to Valery Gergiev’s Kirov company in St Petersburg, $10 million plus to Placido Domingo’s Los Angeles Opera and sundry single-digit million gifts to Salzburg, Bayreuth, Glyndebourne and La Scala for one-off productions.

He’s also given to educational and health causes, but music always got priority.

But now Vilar, 64, has been accused of feeding his addiction to philanthropy by using money invested by clients in his his investment fund. He was arrested last month at Newark airport and imprisoned pending charges of fraud and money laundering.

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The indictment accuses him of taking $5 million from one particular client – the mother of actress Phoebe Cates – to make donations to his alma mater in Pennsylvania. He also used it to pay $15,000 to a catering firm and $255 for dishwasher repairs. A further $3m was allegedly wired to an account in Luxembourg, though Vilar denied any wrongdoing.

Gary Tanaka, who co-founded Amerindo Investments with Vilar in 1980, faces fraud charges too. Tanaka is likewise believed to owe money on unfulfilled philanthropy – including a promise of £27m to Imperial College, in London, to fund its new business school.

Amerindo came to prominence during the dotcom boom when Amerindo was riding high on tech stocks. In 2000 I was sent¹ to interview Vilar at his 30-room apartment in Manhattan – just one of his nine homes.

Among the gold couches, gold columns and gold wallpaper there was a $200,000 sculptured glass dining table featuring instrumental motifs, a wall decorated to resemble Salzburg’s Mozarteum, Lobmeyr chandeliers exactly like the ones at the Met, a life-size statue of Mozart’s Don Ottavio, masked and caped, and another of young Mozart. And that was just one room.

Vilar himself seemed to be one of the saddest people I had ever met. “I was really an anti-social child,” he told me. “I was shy, a religious bookworm, an altar boy. I used to lock myself in a room and listen to music, pretend I could conduct. I knew the whole score for several things, like Tchaikovsky and the Emperor Concerto.”

It seemed Vilar’s lavish musical patronage stemmed from a desire to impress his father, who had not approved of his boyhood interests.

He had married, years earlier, but it didn’t last. Now he was with a woman in her 30s, named Petra; odd though it seems, he introduced me to her in the bedroom, which had a large bed surrounded by mirrors on a rotating platform.

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Alas, Petra didn’t last either. But a couple of years later he met Karen Painter, a married musicologist at Harvard and when her divorce came through, Vilar proposed. Invitations were sent out for an October wedding, only to be “suspended” at a week’s notice. Karen reportedly went back to her husband and had a baby.

About investing was Vilar was supremely confident. “It’s an art. You have to have good judgment. For 17 years out of 19 my firm has ranked first or second. I have compounded interest at over 30 per cent a year.”

But later that year the dotcom bubble burst.

Amerindo lost almost 90 percent of its value. Vilar lost homes in Colorado and when Citibank decided to auction the Manhattan apartment – to offset a $5 million debt – he forestalled the sale by negotiating a particularly unfavorable mortgage.

By 2003 he was defaulting on philanthropic pledges. The Metropolitan Opera in New York removed a sign saying “Vilar Grand Tier” because he had failed to deliver promised funds. Plácido Domingo, artistic director of the Los Angeles Opera and the Washington Opera, said that Vilar was behind on payments to those groups, too. “I’m sorry about Alberto,” Domingo said. “We wish that everything could get solved in the best possible way for him.”

Why didn’t he just stop giving? Because once he’d started, to stop would be mortifying. American tax rules, which encourage long-term pledges, may also have been a factor.

Only now that Vilar has been arrested has the extent of his financial difficulties become clear. The judge initially set bail at $10m but Vilar’s lawyer, Susan Necheles, said Vilar had less than $10,000 in the bank. He couldn’t put up the $25m apartment because the Internal Revenue Service has a claim on it already, for unpaid taxes. She proposed an alternative bail package based on support from his only remaining friends; the four people willing to offer their life savings as surety included a teacher Vilar met 50 years ago in Puerto Rico and his wife, who works part time. “They have very few assets,” the judge noted, before returning Vilar to his cell.

He was released only when the Russian conductor, Valery Gergiev, gave $500,000. Ms. Necheles said she was disappointed that more of his wealthy friends weren’t willing to help. “He’s been a generous person,” she said. “He’s put dozens of kids through school. It’s sad.”²

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In 2000, at his apartment, Vilar had proudly shown me the plaque due to be unveiled at Covent Garden later that year: “Vilar Floral Hall / Dedicated to / Her Majesty Queen Elizabeth / the Queen Mother / generously supported by Alberto Vilar”. It would bear his name forever, he said firmly. “If the place burns down and they rebuild it, I still get that.”

He shouldn’t count on it. With £7m of his promised money still due, Covent Garden has already found a new patron for the Young Artists programme Vilar founded. A spokesman insisted this predated Vilar’s arrest. “We have always pursued a policy of continuing to talk to him. And as a matter of good management, we started talking to other organisations, because we want the programme to continue.” But he said no decision had been made about the Vilar Floral Hall.

“He has actually given us quite a lot of money. We are still enormously grateful for that. Without him the young artists’ programme would not have existed.”

The Institute of Philanthropy was set up in 2000 to research charitable giving in the UK. “Philanthropy seems to have negative connotations,” says deputy director Beth Breeze. “People seem to think it’s all about playboys. It’s not.”

Breeze, who stood as a Labour candidate at the last election, constantly finds herself arguing with fellow leftists about this. Private donations are not an alternative to government funding through taxes, she says, but a supplement: “The NHS can’t send children to Disneyworld.”

The Institute’s research shows that 70 per cent of Britons routinely give money. After the tsunami the figure was 80 per cent. “In the US the proportion of people is about the same,” says Breeze, “but in Britain we give at a much lower level. In Britain it’s never been as high as 1 per cent of GDP, whereas in the US it’s about 2 per cent. And I think that’s because people don’t understand how much charities need.”

Vilar, accused of vanity for blazoning his name in big letters over opera houses, always insisted he was doing it to encourage other would-be donors. “The rich won’t give unless they see dividends,” he said: “I can only hope to set a standard so that other people will follow suit.” The Institute for Philanthropy fully approved of such public pronouncements.

Will Vilar’s arrest have a negative effect on philanthropy in Britain? “I’ll be honest,” says Breeze. “When I read about it I did worry at first. But the important thing is to celebrate giving.” Next week the Institute is hosting a talk by Sir Tom Hunter, the Scottish sports retailer who has already given away something like a fifth of his money. Hunter is expected to remind his prosperous audience what the American philanthropist Andrew Carnegie once said: “He who dies rich, dies disgraced.”

It’s hard to say, pending the outcome of his trial, how that maxim will be applied to Vilar.³

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¹ By the Financial Times magazine. Read my interview with Vilar. ^back

² In the years since I wrote this, I have inevitably come across Gergiev’s name here and there (at the Proms, or whatever) and without fail it reminds me of his generous loyalty to Vilar. ^back

³ In 2020, roughly 15 years after I wrote this article, I heard from one of Vilar’s remaining friends. The man, who was in his 80s, invited me to write again about Vilar – to show him living in virtual destitution in one of New York’s outer boroughs, in sight of the skyscraper where 30 rooms had once belonged to him; and to show that he has set right what he did wrong. I was keen, and asked to speak to Vilar directly, but for reasons I can’t explain, that didn’t happen. Footnote: 25 August 2021 ^back