Like several of the high profile hedge funders, Philip Falcone made his fortune betting against subprime mortgages. Subsequent to the housing collapse, however, Falcone has not done quite as well as some of his contemporaries. Things started falling apart for Philip and his wife Lisa Maria this past May — when an ill-fated communications network called Lightsquared filed for bankruptcy protection. Falcone's Harbinger Capital Partners was one of the primary investors in the country.
Now, the Securities and Exchange Commission is taking Falcone to court for fraud. Falcone plans to redirect the accusations to a "former Harbinger operating chief [Peter Jenson] and two lawyers." Allegedly, they advised him to use over $113 million from the fund in order to pay his taxes.
Philip and Lisa Marie made their philanthropic debut in 2009, before the troubles started, with a $10 million gift to the High Line: a public park on Manhattan's west side (see IP Guide: Fundraising for Parks and Gardens). They also gave between $100,000 and $250,000 to the Museum of Natural History, that year.
Philip's wife, Lisa Marie, tends to be the more active between the two in terms of philanthropy. In the past few years, she has chaired several fundraising events for the American Museum of Natural History and the New York Ballet. Lisa Maria now sits on the board of the latter. In 2009, she collaborated with other board members to raise $1.4 million at a dinner event following a performance of Themes and Variations. The couple has also provided "substantial funding" for the NYC Ballet's Architecture of Dance New Choreography and Music Festival (see IP Guide: Fundraising for Dance).
Still, despite a fortune estimated at $1.1 billion by Forbes earlier this year, Lisa Maria and Philip have not established a foundation or otherwise made any apparent long-term plans for giving the away money.
This week, Falcone said he is taking the helm at a new company, Australia Acquisition Corp., which will change its name to Harbinger Global under Falcone's aegis. Australia Acquisition bought two of Falcone's investments: an iron-ore developer in Brazil and a Vietnamese casino.
Philanthropy has not been as pronounced an item on the Falcone agenda since all of the recent financial and legal trouble started. However, if the Falcones' pass-the-buck defense holds up in court, and they succesfully pull things together with Australian Acquisition, perhaps the family's money will filter once more into city beautification projects, cultural endeavors, and more appearances at associated social functions.
Bottom line: The guy remains a billionaire with a proven knack for making money — and giving it away.