Bernard Cornfeld: Wikis


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Bernard Cornfeld
Born August 17, 1927(1927-08-17)
Istanbul, Turkey
Died February 27, 1995 (aged 67)
London, UK
Occupation Financier and International Playboy
Net worth US$100 million (pre-1970); US$1.85 million (post-1970)
Spouse(s) Loraine Armbruster
Children Jessica

Bernard "Bernie" Cornfeld (Istanbul, 17 August 1927 – London, 27 February 1995) was a prominent businessman and international financier who sold investments in US mutual funds, and was tried and acquitted for orchestrating one of the most lucrative confidence games of his era.


Early life

Bernard Cornfeld was born in Turkey. His father was a Romanian-Jewish actor; his mother was from a Russian-Jewish family. They moved to America when Bernard was four years old – his father dying two years later. The young Brooklyn-raised Cornfeld worked after school each day in fruit stores and as a delivery boy. Although he suffered from a stammer, he had a natural gift for selling and when a schoolfriend's father died, the two of them used the US$3,000 insurance money to purchase and run an age and weight guessing stand at the Coney Island funfair. He graduated from Abraham Lincoln High School in Brooklyn and Brooklyn College.[1]

During the Second World War he joined the U.S. Maritime Service. Afterwards he went to Brooklyn College, graduating with a degree in psychology, and then did an MA in social work at the School of Social Work at Columbia University. He initially worked as a social worker, but then switched to selling mutual funds for an investment house. In 1955, he left New York for Paris and started his own company selling mutual funds, using his savings of a mere few hundred dollars. The company was named Investors Overseas Services (IOS). By selling the mutual funds, mostly to American servicemen in Europe, Cornfeld was able to avoid both American and European tax regulations. As a US citizen he did not avoid US taxes, and the funds sold to US servicemen were US registered and based funds. In the early years the fund sold was mostly the Dreyfus Fund, which was very small then, less than US$2 million. He had a close and friendly relationship with Jack Dreyfus, the founder, and when the management company of the Dreyfus Fund went public, IOS bought an almost 10% ownership in it. Cornfield and IOS fueled the early growth of the Dreyfus Fund from very small to several hundred million dollars, due to his marketing acumen, brilliant advertising of a lion strolling down Broadway, and deft management of the fund.

Investors Overseas Services

In the 1960s, Cornfeld formed his own mutual fund selling company, Investors Overseas Services (IOS), with principal offices in Geneva, Switzerland, although its legal place of incorporation was Panama. He also set up mutual funds in various jurisdictions, as noted below. Although the executive headquarters were in Geneva, the main operational offices of IOS were in Ferney-Voltaire, France, a short drive across the French border from Geneva.

In 1962, IOS launched its "Fund of funds," which meant investment in shares of other mutual funds, including some other IOS vehicles. The offering was very popular in the bull market times, and Cornfeld's one-line pitch, "Do you sincerely want to be rich?" became a by-word for its success. During the next ten years, IOS raised in excess of US$2.5 billion, bringing Cornfeld a personal fortune which has been estimated as more than US$100 million. Cornfeld himself became known for conspicuous consumption with lavish parties. Socially, he was generous and jovial, and generally surrounded by a bevy of beautiful young women, including for example Victoria Principal, later widely known as a star in the TV series "Dallas".

At its peak, IOS employed around 25,000 salesmen, who sold a series of mutual funds door-to-door all over Europe, especially in Germany, to small-time investors. He originally targeted US expatriates and servicemen who sought to avoid US income tax, but the main growth of the business came from the public in countries such as Germany and Italy, who had until then had no other easy access to investment vehicles of this kind. Cornfeld called it "people's capitalism."

There were several reasons for the eventual rapid downfall of IOS, and there is no widely-accepted agreement as to the cause. But it may be true to say that, had the parent company not made a public share offering in 1969, it might have survived for much longer. The pressure to make the public offering came from the salesmen-stockholders, who were eager to cash in their paper fortunes, but the money raised by the company was used by the management to diversify in a number of ways that created a cash shortage. The domicile (but not the offices) of IOS was switched to Canada, and the public offering took place there in the summer of 1969.

Unfortunately for IOS, international stock markets suffered a bear market in late 1969, and the value of the IOS stock took a serious fall. Cornfeld and other company insiders blamed a "bear raid" and said that a number of German banks sold the stock short.

At this point, a little-known American financier named Robert Vesco, head of International Controls Corporation, which had raised some money through the IOS funds, offered his help. By a series of manoeuvres, Vesco managed to take control of IOS and eventually evicted Cornfeld from the management. Having placed his men in key positions in IOS, Vesco succeeded in transferring over $ 200 million of cash belonging to the IOS funds into his own ventures, mostly in Costa Rica and other parts of Latin America. When the SEC issued a public complaint, Vesco fled to exile in a number of Caribbean hideaways, and was finally reported as having died in Cuba in 2008.

Following the SEC complaint, the Canadian authorities arranged for the IOS entities to be placed in liquidation.

Personal life

Cornfeld owned a villa in Geneva, a 12th-century chateau in France, a house in Belgravia, London, and a mansion in Hollywood, as well as a permanent suite in a New York City hotel and his own fleet of private planes. He is quoted as saying, "I had mansions all over the world, I threw extravagant parties. And I lived with ten or twelve girls at a time." He had romances with Victoria Principal; Heidi Fleiss; Alana Hamilton (née Collins - a model and former spouse of George Hamilton who subsequently married Rod Stewart); and Princess Ira of Fürstenberg.

Cornfeld settled in Beverly Hills and moved in a circle of movie industry people. He lived in the Grayhall mansion, built in 1909 and at one time leased by Douglas Fairbanks. Known for his playboy lifestyle, Cornfeld numbered among his acquaintances Victor Lownes, Tony Curtis, and Hugh Hefner, at whose Playboy Mansion he visited and attended parties.

Cornfeld's decline

A group of 300 IOS employees complained to the Swiss authorities that Cornfeld and his co-founders pocketed part of the proceeds of a share issue raised among employees in 1969. Consequently he was charged with fraud in 1973 by the Swiss authorities. When Cornfeld visited Geneva, Swiss authorities arrested him. He served 11 months in a Swiss jail before being freed on a bail surety of US$600,000. Cornfeld always maintained his innocence, blaming the fraud on other IOS executives. His trial did not take place until 1979 and lasted three weeks, with Judge Pierre Fournier finally acquitting Cornfeld.

Realising that his "good time" friends had left him during his 11 months in jail, Cornfeld began to seriously start thinking about his life and decided for the first time that he wanted a wife and children. In 1976 he married a model, Loraine, at his Beverly Hills mansion Grayhall. However, he had difficulty settling down. Polygamy was "considerably simpler than monogamy and a lot more fun," he insisted. He was still worth an estimated US$1.85 million.

Final years

He returned to Beverly Hills, living less ostentatiously than in his previous years. He developed an obsession for health foods and vitamins, renounced red meat and seldom drank alcohol. In his last years he was a chairman of a land development firm in Arizona and also owned a real estate company in Los Angeles. His marriage ended in divorce, and he is survived by a daughter. His daughter, Jessica Cornfeld, wrote an article about her father in the The Mail on Sunday on June 29, 2003, entitled My father, the playboy who could never get enough lovers, where she suggests that he maintained a close friendship with Heidi Fleiss until his death in 1995.

Bernard Cornfeld suffered a stroke and died of a cerebral aneurysm on February 27, 1995 in London, England.


  1. ^ Henriques, Diana B. "Bernard Cornfeld, 67, Dies; Led Flamboyant Mutual Fund", The New York Times, March 2, 1995. Accessed September 22, 2009. "He graduated from Abraham Lincoln High School in Brooklyn and Brooklyn College."


  • The Bernie Cornfeld Story by Bert Cantor, (Lyle Stuart, Inc., 1970). ISBN 0-8184-0013-7
  • With title quoting Cornfeld's celebrated pitch – Do You Sincerely Want To Be Rich? by Charles Raw with Godfrey Hodgson and Bruce Page (Originally published André Deutsch, 1971, ISBN 0-233-96328-6; reprinted by the "Library of Larceny", 2005, ISBN 0-7679-2006-6 )

External links



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