November 4, 2009 | 9:12 pm
Posted by Danielle Berrin
Actor Nicholas Cage reportedly owes the government $6.3 million in back taxes, but instead of ponying up, he’s blaming his money manager.
Cage is suing Samuel J. Levin, his former business manager, who he claims encouraged the purchase of “numerous highly speculative and risky real estate investments” which resulted in the actor “suffering catastrophic losses,” according to the $20 million lawsuit.
But before a dispirited and guilt-ridden Jewish world assumes Levin is akin to Madoff, they might consider a closer look at Cage’s spending habits.
Writing on The Daily Beast, Jacob Bernstein unearths a history of Cage’s profligate spending, and suggests that the actor is at least partly (if not wholly) to blame for his current financial calamity.
According to Bernstein, Cage has royal tastes and expensive proclivities, and little regard for his own financial recklessness. He writes:
Cage’s appetite was extreme even for Hollywood, with a decade-plus shopping spree that saw him snapping up houses, motorcycles, a jet, yachts, vintage and new cars, expensive watches, meteorites, dinosaur skulls, an enormous pet collection, massive amounts of jewelry for the women in his life, group vacations for his entire entourage, and on and on and on. “He lived like a sheik,” says one person who’s known him for several years. “Spent money like it was water,” says another.
Most glaring is Cage’s penchant for luxury real estate. Bernstein claims that he owns more than a dozen properties “in places like Newport Beach; Venice Beach; Malibu; San Francisco; Middletown, Rhode Island; New York; and Las Vegas.” Not to mention the $30 million Bel Air mansion where he spends most of his time, or the two mansions in New Orleans, “a 13,000-square-foot, six-bedroom house in the Garden District” and another in the French Quarter ($3.45 million and $3.5 million, respectively), plus “a castle near Bath, in England, an 11th-century estate in Etzelwang, Germany, and not one but two Bahamian islands.”
Old habits die hard, and Cage has been forced to liquidate most of his real estate. That is, the properties that are not already being foreclosed upon.
Of course, when things were good, and Cage was flush with cash, investing in cars and real estate seemed shrewd.
Cage’s penchant for acquisition was aided by the fact that for years, many of the things he spent money on appeared to be good investments. The vintage cars he bought frequently doubled in value, so Cage made a lot of money buying and selling them. (In his case, most sales were followed by more purchases). Real estate was seen as an even safer bet. According to a source from his inner circle, when the first few houses he bought began to accrue in value, Cage began to borrow heavily against them to buy more properties. Unlike the cars, though, he didn’t do nearly enough selling, which placed him in a particularly precarious position when the market began to collapse over the last two and a half years.
Here’s my favorite part, where two of Hollywood’s biggest stars flex their fragile egos in a testosterone-fueled haze:
There also was a dinosaur skull that Cage purchased in 2007 for $276,000 in a heated auction with Leonardo DiCaprio.
Woe to the ills of fame and fortune.
To read Bernstein’s full article, click here.
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