Neil Cole Sentenced to 18 Months for Inflating the Books at Iconix – WWD

Neil Cole, who remodeled his population industry into the branding powerhouse Iconix Manufacturers Staff handiest to be convicted last year of inflating the books, used to be sentenced to 18 months jail in Big apple federal court docket on Tuesday. 

Future Cole’s lawyers had requested for probation, U.S. Lawyer Damian Williams driven for a jail sentence of six-and-a-half to only over 8 years, pointing in court docket filings to “the calculated, long-running and sophisticated nature of Cole’s fraudulent scheme” in addition to “Cole’s abuse of his position of trust as the powerful CEO of a publicly traded, multibillion-dollar company.”

“From 2014 to 2015, Cole engaged in a scheme to falsely inflate Iconix’s reported revenue and EPS by inducing a Hong Kong-based JV partner, Global Brands Group Asia Limited, to purchase JV interests at artificially inflated prices based on Cole’s promise to reimburse GBG for the overpayments,” Williams mentioned. 

However future Pass judgement on Edgardo Ramos mentioned he believed Cole used to be untruthful all through trial, he additionally described the 2 transactions, which in brief inflated Iconix’s revenues by way of $11 million, as outliers within the corporate’s historical past. He additionally took under consideration Cole’s long-standing charitable endeavors.

Cole will stay sovereign on bail pending enchantment.

“First and foremost, the court has continued Mr. Cole’s release on bail pending appeal,” mentioned Cole’s felony group in a commentary next the ruling. “That decision and today’s sentence comes after the government charged Neil Cole with participating in a fraud scheme with others, and he was forced to go to trial twice to defend those charges. The jury in the first trial acquitted Mr. Cole of all conspiracy counts. Although the second jury convicted, we are confident in the strength of Mr. Cole’s appeal of that verdict and look forward to the opportunity to present our arguments to the Second Circuit.”

Future the affect of the transactions in query are tricky to quantify, the federal government mentioned the events within the case estimated that they inflated Iconix’s proportion value by way of 2 p.c and subsequently netted Cole just about $1 million in too much income as he bought kind of $40 million of the corporate’s book. 

Seth Horowitz, former running officer at Iconix, up to now pled accountable for his involvement within the case and testified at Cole’s trial. 

“Neil would threaten me that my career was over and that I would no longer be able to work at a public company,” Horowitz mentioned, in line with the federal government’s submitting. “He said something to the effect that he knew about the transactions but that he could pass a lie detector test saying he didn’t but he knew I could, too, essentially building a he-said-versus-he-said scenario.”

An preliminary trial in 2021 ended with Cole acquitted of 2 conspiracy counts and a hung jury on 8 alternative counts, together with making fake filings with the Securities and Trade Fee, improperly influencing the habits of audits and securities fraud. He used to be after discovered accountable at the 8 counts in a retrial endmost day. 

Cole’s lawyers mentioned the 2 transactions in query modified his month, in their very own court docket submitting on his behalf. 

“These two transactions — which occurred months apart and represent a tiny fraction of the many transactions Iconix has been a part of over Neil’s long career — led to Neil’s eventual departure from Iconix, and subjected Neil to internal investigations, a civil regulatory investigation, a criminal investigation and indictment, and two trials over the course of two years,” the submitting mentioned. 

The submitting main points how Cole labored on the population shoe industry below the exacting seeing of his father, left the industry, got here again and in the end remodeled it into Iconix, which borrowed in opposition to the highbrow feature of manufacturers to exit on a dealmaking spree, purchasing Badgley Mischka and Joe Boxer, inking a licensing with Madonna for her Subject material Lady emblem, linking up with Jay-Z on Rocawear and extra. 

“By 2014, the business was worth $3 billion on Nasdaq and employed 150 people across multiple continents,” the submitting famous. “The only company in the world doing more licensing was Disney.”

However the fall used to be sun-baked. Via the after day, the corporate used to be below investigation and Cole was out. In 2019, Cole spent just about a era in a resort so his daughter wouldn’t have to peer him arrested, in line with the submitting. And the generation he used to be convicted, his spouse mentioned she used to be divorcing him.

“As he awaits the outcome of this sentencing, and the conclusion of his appeal, Neil has filled his days by helping his sons plan a new business venture, to replace the careers they lost as a result of his trial and conviction, and spending as much time with his family as he can, with the possibility looming that his time with them may soon be cut short,” his legal professionals wrote.

A form of high-profile kin and buddies wrote letters to Ramos on Cole’s behalf. 

His brother, clothier Kenneth Cole, pointed to Cole’s paintings with the Sweets Footing to handle youngster being pregnant, alternative philanthropic endeavors and the ordeal he has already been thru. “Sadly, Neil’s career and personal life have been suspended the last seven-plus years during the course of these proceedings,” Kenneth Cole mentioned. “He has lost the business he built and loved, and along with his kids (who also lost their jobs,) have been forced to live under a shadow making it almost impossible to find alternative employment.”

Cole’s brother-in-law, former Unused York Gov. Andrew Cuomo, mentioned: “I began working with Neil during my first administration and appointed him to the Sage Commission. Here we did our best to help streamline government, which was not an easy challenge. Over the next few years Neil was part of two missions to Israel, meeting with government and showing our support during the Hebrew University bombings and also during the Gaza War in the summer of 2014.”

And Sam Edelman, an extended occasion pal and previous worker of Cole’s, attested to his “character and contributions.” 

“I started my career reporting directly to Neil Cole, when Neil was a vice president at his father’s company called Candies,” Edelman mentioned. “Neil was attending law school at the time, and I had taken over his responsibilities at the company. I had Friday meetings with Neil to bring him up to date on the business and everything we were working on. I have always found him to be smart, sensitive and I had enjoyed our working relations so much that we became close friends and have been very much a part of each other’s lives for over four decades.…Neil has touched me and my family in the most meaningful ways. I truly love Neil. I believe in him, and I believe that he has great things to continue contributing to society.”