Jeffrey Levitt's new life Survivor: A decade after losing his wealth, his wife and his freedom, the villain of the Maryland S&L; scandal is breaking his angry silence.

THE BALTIMORE SUN

BOYNTON BEACH, Fla. -- In America, no matter how many times you fail, no matter how many times you are thrown into the muck in disgrace, you can always try again to get rich. And Jeffrey A. Levitt is a living testimonial to that.

In the '70s, as a notorious Baltimore slumlord, he was convicted of housing violations over 500 times and sparked so much wrath that a tenant once fired a 12-gauge shotgun blast through his window and sent shards of glass into his buttocks.

In the '80s, as a garishly wealthy, overweight swindler, he sent his financial empire crashing to the ground in a scandal that landed him in prison for stealing $14.6 million from his own thrift, Old Court Savings and Loan. Panicked depositors staged a run on the institution, regulators froze $9 billion in S&L; accounts throughout the state, and Levitt became despised by tens of thousands of irate Marylanders who couldn't get at their money.

And now, in the '90s, he sits with loafers and no socks in a small back room crammed with cigars. It's here, in a shop called Dan's News on Florida's Atlantic Intracoastal Highway, that Jeffrey Levitt is in the throes of his latest financial obsession.

"What do you need today?" he asks a tan, middle-aged man browsing among the cigar cases. "I just got some Bicentennial Maduros in here. They're gorgeous, they are absolutely your type of cigar."

The man, who knows nothing of Levitt's past, is impressed by the inventiveness of this small cigar shop proprietor who seems to be able to get anything.

"Jeff, I was shocked that you got those Casablancas for me," he says. "I was dumbfounded."

Levitt, 54, has been leaving people dumbfounded all his life.

This is the man who once rode a golf cart with a Rolls-Royce grille only to be later stalked in the street by enraged depositors. The man who once dressed as the king of England at a gala Baltimore costume party only to soon have his royal status stripped by an angry mob.

The man who bought four Rolls-Royces and a handmade German sports car. The man who knocked around golf balls on his personal $18,000 putting green. The man rumored to have eaten half a dozen desserts in one sitting.

In short, the man who came to symbolize the greed, overindulgence and opulence that fed the collapse of the U.S. savings-and-loan industry in the 1980s. The perfect poster boy for avarice.

Even now, 10 years after the Old Court scandal, he is haunted by his former pariah status. But one thing is certain: after losing his fortune, his freedom, his wife and his reputation, Jeffrey Levitt has survived. He has an afterlife. He's back, and he's breaking a decade of silence to talk about cigars, money and Old Court.

But it's a lot to tell and he's got a lot of places to go.

"It would take me years to explain everything," Levitt says, throwing up his hands while in the passenger seat of a car heading south toward Boca Raton on a recent Thursday night.

His destination is Club Boca, a glitzy pickup bar where lately he has been stocking the humidor with exotic cigars and making a tidy profit.

"I'm worried that I might just become a millionaire again," says Levitt, who is 40 pounds lighter, drives a Mitsubishi compact and lives in a modest condominium. "People back in Maryland would hate me for my success. They don't think I'm entitled to happiness anymore.

"But the details of what happened before, it's the past. If I wrote a book, I would justify what I did or didn't do. Right now, I want to focus on my life here, my business, my feelings now and not then," he said.

It is about a 15-minute ride to Boca Raton from Dan's News, an emporium of newspapers, cigars, greeting cards and candy bars that Levitt runs with a former girlfriend. Cigars are the specialty Levitt brings to the store, and he speaks about them as if they are his salvation.

"I sell an interesting product," he says during the drive. "It's a commodity. It fluctuates with the market, with supply and demand. It's kind of like bootlegging: It's not illegal, but there's a lot of wheeling and dealing. I look at cigars as beauty. It's art."

He got the idea for a cigar business in 1993, shortly after being paroled from the Maryland House of Correction. He had spent six years there after the Old Court scandal, then spent several months on home detention, during which a magazine caught his eye.

It was Cigar Aficionado, which often features movie stars and other high rollers on the cover smoking the cigars that have become a national fad. Jeffrey Levitt, who in the early '80s saw that "S&Ls;" were about to take off, saw the same thing in cigars.

But his reminiscing trails off because the car is pulling into the parking lot of Club Boca.

"Wait'll you see this place," he says.

Club Boca bustles with chic young people sipping fruity drinks. There is dance music but no one is dancing, leaving a large, empty floor for Levitt to walk across as though he is making a grand entrance and everyone has cleared a path for him.

There's a raffle tonight and a voluptuous woman in a revealing bikini is standing in front of a bowl of money near the bar. Levitt takes a look, walks past and points to a glass case. "Those are mine," he says, referring to the Excalibur cigars in the case.

Levitt seems to love the night life, even though he doesn't drink. For that matter, he doesn't smoke, either. That may sound strange for a cigar salesman, but to Levitt this is strictly business.

"Rudy!" he yells to the bartender, a large, boisterous man in an orange jersey bearing a "52."

After accepting a free ginger ale, Levitt leans over the bar and raises his voice over the music: "Hey Rudy, WHO HAS THE FINEST SELECTION OF CIGARS IN TOWN?"

Rudy, busy mixing drinks, rolls his eyes. "You do, Jeff." But the bartender can't resist a jab, and with a grin he adds, "At the prices you charge for 'em, you ought to be buying everybody at the bar a free drink."

Club Boca is one of at least a half-dozen nightclubs, cigar shops and restaurants Levitt visits on his cigar-selling circuit along Florida's Gold Coast. He says it's a busy life and he doesn't sleep much. By day he is in the store, by night he is looking for a humidor to fill.

His actions tell a story of someone who is hustling, deal-making, schmoozing, all the things that made Levitt the figure who always rose so high only to fall twice as low. Yet he maintains that he's not trying to get rich anymore.

"I was rich once. I had millions. I had it, but I lost it. I don't miss it. I had it so I had that thrill," he says.

"You start to realize things. How many polo shirts can you wear? How many cashmere sweaters can you own? You don't need 100 sweaters, especially down here. You need shirts and pants and a pair of shoes."

At another packed club, this time in South Miami Beach, he is trying to score a deal with the young, well-dressed owner, but the man keeps looking around at the huge crowd as if to say, "It's too busy and I'm not buying any cigars tonight." Levitt senses this and stuffs an El Rico Habano into the breast pocket of the owner's suit.

"That's the best cigar money can buy," Levitt says. "I'll see you later."

'Genius' salesman

Dale P. Kelberman was one of the prosecutors who sent Levitt to prison in 1986. If he lives to be 100, he'll never forget Jeffrey Levitt.

"Even back then, he would work until midnight, cooking up these deals in his head," Kelberman recalls. "He's always been a genius as a salesman. In that way he was pretty clever. But he didn't impress you much beyond that."

The son of a garment manufacturer, Levitt did not come from high society in Baltimore, and he possessed little in the way of articulateness and social grace. But whatever he lacked, he more than made up for with relentless work habits and a remarkable drive to make money.

Close friends recall that as a boy, Levitt excelled at the piano. But as a teen-ager, he gave up art to make more money.

"When it comes to dollars, the man has a brain that is incredible," said a longtime acquaintance who asked not to be identified. "He loves to ride the crest of the wave, and that's where he gets his excitement. Self-aggrandizement has always been his food and water."

Making a lot of money has never been difficult for Levitt. In 1966, when he was 24, he invested in rental properties in North and Northwest Baltimore. Initially, his career as a landlord flourished. At its peak in the early '70s, he owned 92 properties.

But the more money he made, the more problems he caused. In a 1975 article in The Sun, a housing inspector pointed to a house and said, "You can tell this is a Levitt property. The porch is falling apart, the window frames are rotting and the yard is a jungle."

By 1977, he had been chased out of the housing business after hundreds of convictions for code violations, most of which were for safety and health hazards.

For a while, he faded from view, as though composing himself for another try.

'Don't worry about it'

It is dusk, and Dan's News is closed but for a couple of young guys who have stopped in to buy La Gloria Cubana Torpedo Number One cigars. They're from a nightclub in Boca Raton, and they are picking out several smokes from the cases on the wall.

One man brings over a handful of Dominican and Nicaraguan cigars and drops them on the counter.

"I hope you guys brought cash, because I'm broke," Levitt says.

"Well, I haven't been selling any cigars this week," one of the men replies somewhat sheepishly, as though he's not quite telling the truth.

"Oh, yeah, like the pope isn't Catholic this week," Levitt says, smiling good naturedly. He rarely smiles and almost never laughs, both shows of emotion he seems to save for customers.

"Hey, wait a minute," one of the men says as he holds a cigar up to the light and knits his brow. "Some of these have light spots on them."

"Don't worry about it," Levitt says flippantly.

"Don't worry about it?"

Levitt is sure they'll sell. "With the low lighting at your place, they'll buy 'em anyway."

With that, the men shake hands and Levitt closes another deal.

"You see?" he says later. "I work hard for my customers. They come to me because I take care of them. I work hard, and I have a good business."

Once a customer asked Levitt if he sold Cuban cigars, which are illegal to sell in the United States.

"I don't touch the Cubans," he said with as much moral indignation as he could muster. "They're too much aggravation."

Road to the high life

Levitt has tried to build himself a new life and forget about the old one. But it will take a lot of forgetting.

In 1982, he stepped into the business he would soon turn into Maryland's biggest financial disaster.

"The whole mentality toward the S&Ls; that swept the country started here," said Kelberman, the prosecutor. "Levitt started it all."

Declaring himself reformed from his slumlord days and contributing thousands to philanthropic causes, Levitt rose into the ranks of the nouveau riche with Old Court Savings and Loan. As the chief operating partner, Levitt vowed that he "could do something nobody else could do."

It didn't take too grand an idea. Old Court offered some of the highest interest rates in the country -- up to 14 percent -- and

drew a steady stream of depositors.

By late 1984, Old Court's assets were worth $839 million. Levitt and his wife, Karol, who were teen-age sweethearts in Baltimore, were regulars in society columns. They lived in a five-bedroom, six-bathroom house in Lutherville with a suit of armor in the foyer.

The couple collected more than a dozen cars, bought vacation homes in Ocean City and Boca Raton, and filled their Lutherville home with silver and Steuben glass.

Jeffrey Levitt had built himself the world he had always wanted to live in. But he built it with stolen money.

He and his soon-to-be-imprisoned partners, Jerome S. Cardin and Allan H. Pearlstein, had been using Old Court's assets in investments designed to bring wealth not to depositors but to themselves. They paid each other exorbitant commissions and fees, set up sham business entities, and obtained insider loans that were not secured or repaid.

More than $600 million in depositors' assets were frozen for five years as state officials tried to sort through what they called a giant slush fund. At one point, international banking regulators said the Maryland S&L; scandal had even shaken confidence in the U.S. dollar abroad.

Labeled as fat and having excessive appetites for food and possessions, the Levitts became easy targets for jokes about greed and overindulgence. Jeffrey Levitt was dubbed "The Count of Monte Crisco," a "Jeffrey and Karol Joke Book" was published, and Levitt caricatures appeared on T-shirts and oversized sweat shirts.

"The physical appearance of both of them fed the frenzy," recalls Bill Hundley, the lawyer who represented the Levitts and became a family friend. "It was that perception of greed. When we came in for the arraignment, they had to put up police lines to keep the angry people away from us."

Through it all, Jeffrey Levitt insisted that he could have made it all work if only the investigators and the regulators hadn't interfered. Somehow, Levitt seemed to believe, he could have worked some magic to make all the numbers right, made everyone happy, and put back the money in everyone's pocket.

"He always told us that if we'd have left him alone, the roosters would have eventually come home to roost," Kelberman, the prosecutor, says incredulously. "He was so sure he could pull it off."

'Ridiculous' dessert story

At times Levitt speaks about the dessert controversy with more fervor than the scandal itself.

"The scandal got out of control. Everybody wanted to get their two cents in and somebody came up with this ridiculous story about six desserts," Levitt says, referring to popular lore that he and his wife ate six desserts apiece at a Baltimore restaurant. "It upset my wife terribly. What happened was we were at Tio Pepe's and we ordered six desserts, one for each of the six people at the table."

Levitt doesn't make any apologies about Old Court and says he paid for his mistakes, which he attributes to surrounding himself with the wrong people.

He paid back what he stole and has completed 1,500 of 2,000 hours of court-ordered community service. He helped serve food at Bea Gaddy's Thanksgiving feast for the homeless in Baltimore shortly after he was paroled in 1993. Since then, he has worked his community service at hospitals in Florida.

"I paid more than enough. It cost me my wife, who I cared for very much," Levitt says of Karol, who died of a heart attack in 1989 at age 46. "Most people never knew me. Nobody said I was lily white, but I wasn't lily black, either. I was no angel. But the past is over. When is it going to stop, the gore and the blood?"

He is upset by a recent Baltimore television report about one of his financial efforts after he left prison. He invested stocks for about 10 acquaintances who signed over powers of attorney to him. As always, Levitt had the touch of gold at first and made money for everyone. Then, his investments went south, and he )) lost more than $200,000 of his clients' money through stock options.

Officials in Maryland and Florida are investigating, although they say they have found nothing illegal.

Since then, he has put all his effort into the cigar business, which he says he financed through money given him by his stepfather.

"In the '80s, I was always in a hurry. I'm not in a hurry anymore," Levitt said. "If I strike it rich, I'll be a happier man. But it won't change my lifestyle. I'm not belittling money. But it can't bring back certain people that are gone. It can't bring back a lifestyle that is gone."

'Sick of FAT jokes'

Levitt is sitting on a white, plastic chair outside Dan's News on a hot, sunny day in February, holding his wife's diary. His eyes well with tears.

"Read the diary," he says. "You'll see why I'm bitter."

Karol Levitt wrote the pages while serving 12 weekends in jail in 1986. Although she had no role in running Old Court, she had agreed to help her husband avoid a court order limiting the couple's spending to $1,000 a week.

A woman from a fine Baltimore family, Karol Levitt was one of the most tragic figures of the Old Court era. She left perhaps the most vivid image of the time: a heavy woman walking past a horde of reporters outside a Baltimore courthouse, the collar of her oversized, blue vinyl raincoat drawn up and sunglasses hiding her eyes.

On her first night in the Baltimore City Detention Center, she recalled the laughter of other female inmates as she stepped into the shower.

"I am so sick of FAT jokes," she wrote, reciting one of them: "If you want to remove the snow from your walkway, sprinkle it with chocolate and let the Levitts eat it."

The ridicule hit her hard -- "Would there be jokes and sweatshirts if I had a physically crippling disease?" she asked herself -- but she never turned on her husband. Indeed, she remained loyal to him to the end, saying he had remarkable resilience.

She described him as a "loving sentimental husband and father. A genius and a survivor. When the deck is stacked against him, he turns into Winston Churchill.

"We misjudged and were deeply affected by certain of the rats who deserted when the ship began to sink," she went on. "They seemed to be sure that JAL [her husband] knew in advance what was coming and felt he should have warned them so that they could get their money out in time. If he in fact did know he was too dumb not to withdraw our funds either."

'I'm working too hard'

It's Friday night and Jeffrey Levitt is sitting at a cocktail table with a red table cloth in a dimly lighted room in the back of an upscale pool hall in Boca Raton. Lots of cigars are bought and sold here.

Levitt is in the middle of a cigar deal with the pretty humidor manager, one of his regular customers. Behind them on the wall is a giant poster bearing the face of a woman smoking a cigar; under her face are the words "We're Smokin.' "

"You're supposed to find me a 45-year-old woman worth millions so I can retire," Levitt says to the manager, a woman in her late 20s. "I'm working too hard."

Levitt closes a $1,200 deal with her. To celebrate, she offers him a free drink. He declines but accepts a free dessert instead.

This is a golden moment for Levitt, the moment when the sale is finished. Amid bites of a slice of Oreo cheesecake, he tells the woman, "I give you better deals because I love you."

She rolls her eyes.

"Yeah, right," she says. "You love me if I find you a woman worth millions."

Pub Date: 3/16/97

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