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Perry Gartner
Posted By: Jake Jacobs
Date: Saturday, 16 December 2023, at 12:19 a.m.
Perry and Thrust
With apologies to Dion DiMucci:
Here’s a story, sad but true About a guy that I once knew He took our money and ran around Ended up way out of town
I met Perry Gartner around thirty years ago. It was at one backgammon tournament or another. He and his wife, Norma, became part of the regular group of us who went to dinner together. In the years around the millennium, we partnered in a few of the $10,000 entry Pro-Am events, with a semifinal finish one year.
In the spring of 2003 Perry called me. I had moved to Tucson from Chicago, and was looking for things to do. He had a thing, if I was interested. Perry was in the process of starting a business, a manufacturing and exporting concern in Ningbo, China, in partnership with a local named David Yuen he’d met through his existing importing business. The products were painting tools, inexpensive ones to be sold through Sherwin-Williams and later, WalMart. Perry had designed some, and had applied for US patents. Some items would be made in house, others at various molders, still others from companies in and around Ningbo. Most of the factory’s business would not be molding, but packaging and shipping. They already had their first major order, eight container loads destined for Sherwin-Williams, but the partnership contract between Perry and David was not yet signed, there were problems with all of the injection molders, etc.
Ordinarily, Perry should have been on a plane to China posthaste, but he had various problems, including a computer crash, a flood in his house, and I forget what all. He couldn’t go, and needed someone to go in his stead. My then girlfriend claimed he really wanted someone else to go because the SARS epidemic was ongoing. At the time I told her Perry would never do that, though twenty years later I am not as certain.
At any rate, I had been following SARS closely. I read the South China Morning Post every day, so was better informed than most people in the US, and was sanguine that the worst was over, and the dangers receding. I was a bit more concerned about tackling the job. About all I knew about home painting was which end of the brush got the paint. Perry and his staff in America, David and his staff in China, were throwing around terms like “pad painter” and “edger-trimmer.” I had no idea what those were. The only factory I had ever worked in was a grinding factory, two Saturdays where I lugged steel bars around the warehouse. I knew nothing about import-export. I spoke some Mandarin, but far from enough to be useful. I didn’t know international law, patent law, or anything about accounting. A “GAAP reconciliation” to me meant a couple making up in a clothing store. I didn’t know the rental rates for Chinese factory sites, what to ask our sources, the rubber makers, wood workers, and especially the molders I would be trouble shooting. Heck, my Chinese-English dictionary’s word for “extrusion,” a type of molding we needed doing, baffled every Chinese speaker I showed it to. Because I knew nothing about anything, I was in some ways ideal. I simply redefined my job description to: Find shit out, and write reports. And thought: I can do that!
So I went to the Chinese consulate in L.A., got a thirty-day visa, and with a laptop Perry shipped me (I didn’t own one at the time), I flew to China at the beginning of June.
It was a fascinating trip. I worked ninety hours a week, and still couldn’t get everything done. I did get a lot done, however, including two very important things. One was to uncover the fact that David Yuen was ripping Perry off. The other was learning from other expats that Perry had been misinformed. He believed that he had to have a Chinese partner to start a Chinese business. I learned he didn’t, and one of my last acts before returning home was to place an ad in the local paper seeking key personnel for what would be a business wholly owned by Perry.
Three months later, he had me return to Ningbo. I interviewed and hired his first three employees, a general manager, a financial officer, and a plant manager who I had to fire before the month was over. With their help I found a pair of buildings in a new industrial park, and signed a lease for the headquarters of Ningbo Workfast Tools. And much more. Besides setting up the business, we still had David to deal with. He was still working on completing that same order for Sherwin-Williams, there were still problems with the molders, etc. I worked a hundred hours a week, and figured it was a good thing there was no third trip, as it might have killed me. When I left, I had the satisfaction of knowing that the company was launched.
A year later I moved to Asia, and saw and heard little from Perry. What little I did hear was enough to know that while the path wasn’t smooth – Perry might have had a good book out of all that happened – the factory was up and running, and doing fairly well.
In early 2012 Perry reached out to ask if I knew of anyone who might loan him money. Not “a hundred bucks until next Friday” money. This was the sort of loan usually negotiated with banks. It seems that after the financial crisis of 2007-2008 banks were chary of dealing with Chinese businesses. At least his old bank was, and his new bank was only advancing half as much credit as the old. He needed a bridge loan, because he was in a cash crunch. The amount he sought was too much for me, but my boss, Jim, had deep pockets, and I thought he might be interested.
I told Jim that Perry was someone I knew from the gambling world. Which carries some weight. Our world was one where people were often trusted with lots of cash, so there is an expectation of honesty above and beyond that accorded non-gamblers. Perry showed us the books, and it appeared the operation’s assets were great enough to inspire confidence, as was the level of business, with rosy prospects for increases ahead. He and his daughter not only signed a regular loan agreement, but they signed personal guarantees as well. We didn’t give him as much as he wanted, but it was a lot of money, nonetheless. I put up one-tenth, Jim the rest.
The loan was for eighteen months, and a year or so into it, the interest payments arriving like clockwork, he asked for a second loan, whose term was for just four months. It was smaller, albeit still a lot of money. I put up a quarter of it this time. Interest payments from both loans arrived until the fall of 2013, when both came due. All payments stopped, and our money was not returned.
In the back and forth we learned that Perry had gone to the Donald Trump School of Asset Evaluation, and graduated with honors. A million dollars’ worth of assets suddenly were worth closer to zero. And he and Marcy, his daughter, who were not supposed to be withdrawing money from the business, had been doing just that. Her salary was part of “Payroll,” while he had “loaned” himself money which would be written off as bad debt. Oh, and not only was his bank first in line for any money from the company, the personal guarantees they made with us, had also been made with the bank, which was first in line there as well. And Perry and Marcy were, he claimed, poor as church mice, holes in their socks, Norma’s jewellery pawned, second mortgages on his house and condo.
When confronted, there was a great irony. Earlier I mentioned uncovering David Yuen’s perfidy? The day after we discovered it, what would prove to be only the needle point on what time would reveal was the tip of an enormous iceberg of theft and chicanery, I had lunch with David, who did not know that we knew. After the meal I smiled at David and said: “You never told me you were a fucking crook.” And when I told him what we’d found out, the first of his rationalizations was: “The electricity cost more than we thought.” Which means little in and of itself; it was the thought process. These guys never think of themselves as crooks, even though he was up to much more than clipping the few thousand dollars we’d so far uncovered. When I confronted Perry, his response was along the lines of: “A man’s gotta eat.” Until then I saw Perry and David as different, but in that moment, when he echoed David, I learned the truth.
We had been played for suckers, and then proved Perry knew his marks when, with the threat of a lawsuit the thing we hung over his head, still hoping to get money flowing our way, he asked for: another loan! This one was much smaller, only fifty thousand dollars. And it would be “secured” by a WalMart order. The fifty would pay for the supplies for the order, and when WalMart paid, we’d get that. Rather, Jim would. He put up the fifty. And then he and Perry agreed to roll the loan over, because the WalMart orders were ongoing. For six months he collected interest payments, then told me: “Let’s see about the promise of payment.” We asked for the return of the fifty, which might have soon been tendered yet again, if Perry repaid it. You know what happened.
The most amazing conversation of all was soon to come. Perry called me, and started off by saying that if it were just Jim, he wouldn’t worry about repaying him, but because I was a dear friend, here was what he was offering. What he wanted was for us to tear up the agreements. Pause for a moment to reflect. He was already claiming that our signed agreements were worthless, and at least in Jim’s case, he had no interest in honoring them. He wanted us to trade them for a verbal agreement. Uh, huh.
He had, he said, an angel, someone who would take over the business. The only fly in the ointment was our agreements. With those, the man wasn’t interested, but if we tore them up, this fellow would take over the business, pay off the bank, and all the suppliers they were in arrears to. He may have even planned to square Perry’s personal debts. Or so Perry said. Then, he would hire Marcy to do her old job, at nearly double her old salary. Of which we would get half? After all, she would not even have to tighten her belt. No, no! Not a penny of that. This magic genii of Perry’s was also offering bonuses, to Marcy, and to Perry who would be “consulting,” should they hit certain sales targets. The numbers were not impossible. Highly improbable, but not impossible. And what percentage would we get, what slice of this pie in the sky? Nothing from Marcy! And from Perry, fifteen percent. Yes, fifteen percent. And, just in case he had not rubbed enough salt in the wound, only until our principal was returned, certainly no accrued interest you greedy things!
I still cannot wrap my head around it. Even in what was a con job based upon a fantasy, he was so greedy he offered those terms?
That was the last time I ever spoke with Perry Gartner.
We hired an attorney in New Jersey, and things seemed to be moving along nicely. Then, between Perry and our lawyer, the wrong one died of cancer. Perry, meanwhile, moved to Florida, where I am told it is harder to collect. Since then, I guess he has been helping O.J. look for the real killer. I have not kept up.
Over the years I have spoken to a few people. Phil Simborg, for one, to explain why I would never enter a tournament from which Perry might profit. But in general, I figured this was my business, and Jim’s. I wasn’t seeking sympathy, or to enlist others in some crusade. Perry was already in his eighties, and I thought he’d put the “dead” in “deadbeat” soon enough. But at the recent California State Championships I learned from a couple of people that in recent years Perry had approached each of them looking for loans or investments. His terms, as they were with me and Jim, were attractive, but these guys were smarter than me and Jim, and refused the bait. If he approached them, he has probably approached others, and so I am telling my story. If you decided to invest in Perry, that is your business. However, I won’t have to feel guilty because I failed to warn you.
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