Black and White on Wall Street: The Untold Story of the Man Wrongly Accused of Bringing Down Kidder Peabody
BY JOSEPH JETT WITH SABRA CHARTRAND
MORROW, NONFICTION, 387 PAGES

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By David Bowman

May 27, 1999 | Joseph Jett is an African-American bond trader whose recently published memoir, "Black and White on Wall Street: The Untold Story of the Man Wrongly Accused of Bringing Down Kidder Peabody," is a real corker -- and Jett himself makes for one of the most compelling narrators I've read in years. His story begins in early April 1994, when he awoke before dawn, flipped on the TV and saw a news report accusing him of committing one of the largest securities scams in history. Jett learned that his employers, Kidder, Peabody & Co., had claimed that he'd recorded $350 million in phony profits and then bilked them of $8 million in bogus bonuses. Jett claimed he was an innocent man.

In the months that followed, Jett was vilified in the press and even fictionalized on the television show "Law & Order," all while being investigated by the Securities and Exchange Commission, the National Association of Securities Dealers and the Justice Department. Kidder, Peabody's parent company, General Electric, eventually sold the firm, attributing its exceptional losses in part to Jett's alleged rip-off. Was he guilty? By Thanksgiving 1997, Jett was cleared of the major charge against him, securities fraud (although he was sanctioned for "books-and-records violations," fined $200,000 and ordered to return $8.21 million in bonuses to Kidder, Peabody), but by then he'd become yesterday's news and he felt his vindication wasn't as widely reported as the initial charges against him. So he wrote this book. As riveting as this story is, Jett does not come off as an entirely sympathetic narrator. In fact, he's more like an anti-hero: think Clint Eastwood in "A Fistful of Dollars." According to Jett's own account, at Kidder, Peabody he functioned as a financial samurai striding through a milieu of fools.

In person, Jett is one of the most complicated men I've ever met. Back in 1994 when the Kidder, Peabody scandal first hit, Jett made several television appearances, and he came across as an arrogant prig. In person, though, he's surprisingly delicate, otherworldly. His eyes are twice as wide as those of most other humans. He'd fit in perfectly playing an alien crew member on "Star Trek," and as we talked, it became obvious that Jett was not meant to feel at home on this planet. He may be a brilliant investor -- or just a brilliant charlatan -- but thank God he isn't an artist, or he'd surely have sliced his ear off by now. As it is, Jett continues to practice the dark art of finances with grace and humor.

The $30 billion you handled for Kidder, Peabody is equal to the GNP of some nations. It's like you were running your own small country down below the World Trade Center.

Yes, $30 billion is huge. I don't know if there are any kind of Wall Street brokers who've ever handled that kind of money. I was big. It just goes to show you there is so much negligence in the covering of this story. Reporters kept pointing out aspects of my personality that were controversial and it never occurred to them to ask, "If this guy is such a weirdo, how in the world could he handle all that money?" The question never arose. A reporter at the New York Times wrote a story sympathetic to me and said his editors nearly gave him a physical beating: "Nothing sympathetic about that guy is going to go in this paper."

So your gig was to invest this $30 billion -- but even if you lost it all, that's not illegal, right?

Exactly. What happened is I had $30 billion in assets. I was told, "We have an emergency. Liquidate your entire portfolio as quickly as possible." So I sold off everything and lost $300 million. That's a 1 percent loss, basically chump change on Wall Street. At the same time this happened to me, Orange County [Calif.] lost 40 to 60 percent of their assets, OK? I lost 1 percent. Yet I ended up on death row essentially, in terms of my career, and the Orange County officials got off scot-free.

What percentage of traders on Wall Street are black?

One percent.

Did black traders rally around you?

No. there was no rallying around me. Even though there is a lot of pressure among black groups for diversity in the workplace, there isn't very much room for diversity in the black race if you don't affirm to the party line on affirmative action.

I took pains throughout this entire affair to never mention my race. The very idea of playing your race card -- using your race card to justify your performance -- all those things my father would never allow. I would not raise racial dynamics as an excuse in this affair until I felt I had proven myself innocent.

In your book, you talk about living your life as if you were at war. Why wouldn't you play the race card to your advantage if you could?

Certain weapons indicate weakness rather than strength. And the race card is one of them.

Even though I was black and my accusers were white, I felt the evidence and the numbers would see me through. My lawyers very often said to me, "Next time you give an interview, don't mention affirmative action. We'd like to get Jesse [Jackson], Rev. Al [Sharpton]. Somebody to show up and get behind you." I said, "If someone asks me the question, I have to be honest."

I've been approached by a couple of Hollywood actors about this book and they say, "We have to change your character. You're not quite ... street. Can you, 'Yeah mama. Yeah, baby.' Drive a fast car." All that sort of stuff. Acting black.

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