The Justice Department said Wednesday it will pursue civil fraud claims against Mario Gabelli, the iconic fund manager who’s been among the most influential media and entertainment investors of the past two decades.
A DOJ lawyer said the government would take over a private lawsuit alleging that Gabelli schemed to deceive the FCC in auctions of cellphone spectrum.
The suit seeks hundreds of millions in damages from Gabelli and others whom it alleges created sham companies to bid for discounted licenses in auctions between 1995 and 2000, and then sold the licenses at a profit.
Minority and small businesses can receive discounts of up to 25%. They’re allowed to have backing from larger companies but must be independent, and not merely fronts, as is alleged in this case.
Gabelli, whose Rye, N.Y.-based firm has more than $20 billion under management, has vigorously denied the charges.
The highly regarded moneyman, with his characteristic shock of white hair, is a regular on the New York film premiere and media circuit.
In 1994 his firm Gabelli & Co. created the Gabelli Global Interactive Couch Potato Fund to focus solely on investments in media, entertainment, telecom and the Net — one of the first of its kind. It’s run by Mario Gabelli’s son Marc Gabelli.