Morning Coffee: When executive assistants steal from bankers and buy handbags. The joy of being Apollo

If you're an executive assistant (EA) working with senior bankers or hedge fund managers, you are exposed to temptation. A good EA might make $250k. But this is not enough to shop regularly at Louis Vuitton and Gucci. Or to buy your husband a speedboat.

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This is probably why, every now and then, an EA accesses her boss's bank account and buys a selection of prestigious items before eventually being found out and prosecuted.

The latest to go down this road is Catalina Corona, who was working for Richard Schmeelk, a former partner at Salomon Brothers. Corona reportedly stole $30m from the now deceased Schmeelk and spent it on handbags, Apple products and flights. She pled guilty to charges of theft this week and now faces decades in prison. 

Corona was not the first EA to extract money from Schmeelk. In 1999, a former EA - Bebe Fazia Laljie - also stole $800k from him to pay her credit card bills and was sentenced to 46 months in prison. 

Nor was Schmeelk the only banker with an EA who liked handbags. In 2004, Joyti De Laurey was sentenced to seven years in prison after stealing £4.3m from her bosses at Goldman Sachs. She bought handbags, jewellery, watches and a speedboat for her husband, who later said he thought she was earning big bonuses. 

DeLaurey's ex-Goldman boss - Scott Mead - has since become a fine art photographer. Schmeelk was enjoying his retirement. Ironically, he seems to have been parsimonious during his career. At Salomon, Schmeelk would reportedly fly from New York to Toronto and back in a day to save on hotel rooms. 

If there's a lesson in the repeat infractions, it's that senior bankers probably shouldn't give EAs access to their bank accounts or trust them to pay bills. Bankers work hard, but so do EA's. -  DeLaurey's husband said she barely came home when she worked for Goldman. "I was lucky if I saw her for an hour a day. Sometimes I would not even see her for a few days." It's not clear whether she was shopping during this time, though.

Separately, it's great to be Apollo. The private capital group spotted the danger of investing in First Brands before it crystallised and said in February that it also had the foresight to avoid investing in the sorts of software companies that are now threatened by AI.

But even if Apollo had invested in software companies, all might have been ok. A new Substack post analysing Apollo's investment in a collapsed European real estate firm (Hemingway Real Estate (Lux) SCSp) suggests that even when investments lose money, private capital firms can use accounting mechanisms and multiple entities to mitigate the pain.

Meanwhile...

Andrew Bailey at the UK Financial Stability board thinks the war might have unforseen consequences. “Private credit is a relatively opaque world and it’s not yet, of course, because of its relative newness, actually come under stress, and we may be seeing that now.” (Bloomberg) 

Investors attempted to pull more than $20bn from private credit funds in the first quarter. Apollo Global Management, Ares Management, Blackstone, Blue Owl and KKR were all affected. (FT)

Where is Sonny McNess, the ex-JPMorgan trader who joined Mercuria and built such massive aluminium positions that the London Metals Exchange had to change its rules? Not at Mercuria, it seems. (Bloomberg) 

BDO is cutting 31 UK partners so that younger people can come forward instead. (Financial Times) 

AI cannot be used for investment decisions because it is “absolutely crap at judgment.” Tools are “sycophantic” and agree with users' hypotheses. (Financial Times) 

What is BlackRock? “BlackRock has historically been viewed as a diversified asset manager that’s really good at making ETFs. But the interesting thing that piqued my attention in the last 12 months was that BlackRock is also one of the best data and software companies in the industry.” (WSJ) 

Chris Rokos is up 4.7% this year. Brevan Howard is down 1.09%. (Bloomberg) 

Bank of America thinks the sports betting market is worth $1.1 trillion. (Bloomberg) 

The White House told staff not to bet on prediction markets. (WSJ) 

The Iranians making Lego videos about the war are open to storylines. “We’ve committed ourselves to learning more every day about American people and culture. In this process, Americans themselves have been helping us—and that support and guidance continues. They share impactful tips and ideas with us.” (Wired) 

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