Already a Bloomberg.com user?
Sign in with the same account.
The white yacht bobbed at the end of a pier on the St. Johns River in Central Florida. On the opposite riverbank, several men tried to convey boredom from a distance: stretching, taking off sunglasses, yawning, squinting, replacing sunglasses. The small team’s leader, Ken Cage, peeked at the boat through binoculars, then turned with a snap. “That’s the one,” he said.
The four men—Cage, his No. 2 man, a boat captain, and a driver—hustled into two trucks, wheeled over a river bridge, and entered the marina. They walked quickly along the waterfront until they saw their target—a gleaming Luhrs yacht—and huddled again behind a patch of tall grass. “That has to be our boat,” Cage said. “Has to be.” The team fell silent. An alligator lay motionless in the grass three feet away.
Photograph by Gasper Tringale for Bloomberg Businessweek
The St. Johns emerges from central swampland and descends less than an inch per mile, lolling instead of rolling. The marsh seemed to be reclaiming the small marina itself, host to only a handful of working boats. It made a strange home for a seagoing sport yacht. “He probably knows we’re after him,” Cage said. “He figured we’d never find it here. See how he has it tied parallel to the dock?” All the other boats sat like parked cars, nose to the dock. “He wants an easy getaway.”
Cage and his guys make a living taking from the rich. He’s one of a handful of the world’s most sophisticated repo men. And while the language may be different from the doorbusters who grab TVs, the game is the same: On behalf of banks Cage nabs high-dollar toys from self-styled magnates who find themselves overleveraged. Many of the deadbeat owners made a killing in finance and real estate during the economic bubble—expanding it, even—and were caught out of position when it burst. So now men like Cage steal $20 million jets like they were jalopies. And fast boats. Even, on one occasion, a racehorse.
A pair of local fishermen stepped out of a building on the dock, looked curiously toward the newcomers, and took a few steps forward.
“Now or never,” Cage said. He bounded to the end of the pier and climbed onto the yacht’s deck. The other team members, including Cage’s lieutenant, Randy Craft, moved to their assigned lookout positions on the dock. Craft always handles security; he’s a colossal human, with a polished bald head and fists that hang like wrecking balls. (He had, moments ago, tried to grab the immobile alligator by the tail, sending it thrashing into the river. “Ah, just a small one,” he said dismissively.)
Cage made his way to the stern and leaned over the rear to examine the hull number. “This is it,” he said.
Craft leapt aboard and pulled out a small set of lock-picking tools. While he kneeled at the cabin hatch, focused on its lock, Cage’s boat captain jumped aboard. “Look,” he said, and pointed to the owner’s cooler full of beer, sitting in the sun with the ice not yet melted. Cage hurried to untie the boat from the dock. If the owner appeared before they got the engines running, they would shove away with no power and drift ever so slowly until they could get her started.
Photograph by Gasper Tringale for Bloomberg Businessweek
With a final flick, Craft popped the lock. He climbed down into the cabin, where the bed was rumpled from a recent sleeper. The whole endeavor suddenly felt less like an act of piracy than a home invasion, but Craft stayed focused. He grabbed the boat’s ignition keys from a shelf and tossed them to the captain, who fired up the twin diesel engines. And then, just like that—as the two locals on the dock stood staring—the yacht pulled away from the pier. The bow tipped up as it gunned toward Cage’s own hidden marina to the south. The owner might return soon from a bathroom, or newsstand, or diner, to find his boat gone.
Cage climbed up to the yacht’s bridge, into the wind, and sat grinning. “This is the best part,” he said. Half-exposed cypress trees lined the riverside where turtles and herons posed in the Florida sun. Not bad for the scene of a heist. “Yeah,” he said. “But I really like doing jets.”
Indicators of economic hardship can come from strange places: the relative price of a Big Mac; an increase in mosquito bites due to foreclosed swimming pools; and, of course, repos. In 2007 auto repossessions in the U.S. rose to a 10-year high of about 1.5 million. In 2008 the total jumped to 1.67 million. By 2009 it had reached almost 2 million, the worst in a generation. The number dropped to 1.3 million in 2011, in part because repossessions depend on people buying cars in the first place.
Cage’s high-end repo company in Orlando can hardly keep up with demand. In 2007 the value of vehicles grabbed by his company, International Recovery & Remarketing Group, or IRG for short, totaled about $16 million. By 2009 it hit $100 million. The volume has dropped, but the value of the targeted vehicles continues to rise. He pulled off 1,000 repos valued at $100 million in 2009, and expects that number to drop to about 400 by this year’s end—yet he’ll still pass the $100 million mark in 2012.
Dealing a low blow to high society suits Cage. The 46-year-old grew up near Philadelphia, the son of a trucker, and as a young man worked shoveling hazardous waste into an incinerator. Then he earned his degree in mathematics, with honors, in 1998, and took a job in cash management at J.P. Morgan. That’s where, later that same year, he first encountered the mortgage-backed securities that would eventually cripple the American economy. “It was a strange time,” he says. “Every day trader was making a million dollars a day.”
In 2001 he took a position in Chrysler’s finance division and saw the American credit industry turn “really squirrelly.” He worked collecting debt or, failing that, hiring repo men to collect cars. One day, trying to find a debtor in Oklahoma, he pulled the person’s original application for credit, filled out at the dealership. It was blank. “There was just a name,” he said. “I thought, ‘What are we doing here?’ ”
Photograph by Gasper Tringale for Bloomberg Businessweek
Over the next few years, Cage watched people’s lives unravel as they fell behind on their payments. Once a car owner was two weeks late, Cage would take over the case, making a phone call to the owner. After a month the loan became “high-risk,” and he opened an investigation. After three months, Chrysler’s “skip tracers”—specialists who track down debtors, or “skips”—repossessed the car. Cage found no joy in his work. “The guys would go out to repo a car and call me up,” Cage said. “They’d say, ‘This minivan has a baby seat in the back. What do you want us to do?’ I felt this conflict all the time.”
In 2005, Cage decided he’d had enough. He, along with a financial partner, decided to set up a different sort of repossession company. No more gut-wrenching phone calls. No more shady credit. No more baby seats. He’d go after the million-a-day guys.
Right away he discovered that wealthy repo subjects can brawl like longshoremen. One angry debtor attacked Cage with a shovel. One ran down his lieutenant, Craft, in a car, bouncing him off the fender. Another time, as Cage made off with a fast boat, the owner jumped into a faster boat and, like a villain in a James Bond movie, chased after him. The guy backed off only when the U.S. Coast Guard arrived.
The team once repossessed a jet from a former player for the San Francisco 49ers, and as they arrived the man lumbered out of the plane. “His eyes were wild,” Cage said. Dave Larson, one of about 30 pilots Cage retains, went about his business. When he turned his back to the former linebacker, “I just remember flying through the air,” Larson says. The man had hit the pilot with a penalty-worthy block to the back and sent him 20 feet before he crashed to the tarmac. So Craft—a former wrestler—stepped in and faced down the big adversary while the pilot staggered onto the plane.
Some of their repos are straight out of Magnum, P.I. Craft once tried to grab a yacht in the Bahamas, but needed to lure the owner off first. The yachtsman had a reputation as a womanizer, so Craft paid a girl at the marina bar $100 to entice the owner in for a drink. He sprang at the chance, then Craft slipped onboard and took his boat. Later, when the angered man and his wife came to IRG’s office to claim personal property from the yacht, Craft handed over various itemized lingerie and sexual paraphernalia. “Stop!” the man said, as his wife glared at another woman’s underwear. “That’s enough.”
The job appears simple enough: A bank calls Cage and describes a target boat or plane. Cage finds and retrieves it, then takes a cut of the eventual sale price. Yet there’s an added element of theatrics when dealing with the superwealthy. Just getting to them can require elaborate playacting and fake accents.
Cage’s office manager, for example, is a bright, tough woman named Glenda Shelton. When she’s tracking down a vehicle on the phone she becomes “Stacey,” an effervescent, bleached-blonde giggler deeply curious about big-ticket modes of transportation. At one point, Cage needed to verify the location of an obscure plane and knew a direct approach wouldn’t work; airport operators, protective of their rent-paying clients, don’t like to give out information. But when talking to Stacey, men tend to feel superior and drop their guard.
“Hi, I heard y’all have a cute—what is it?” she said. “A Snoopy plane!”
The airport official thought a moment. “Snoopy plane?” he said. Then he burst into laughter. “You mean that Beagle? Oh, man.”
Cage speaks with a pinched Philadelphia accent, which is fine when he’s working in, say, New Jersey, but in the other luxury repo hot spots—California and Florida, in particular—the accent intimidates people. So Cage uses that, adapting the characters he plays to include authority figures, insurance adjusters, private investigators. It’s the vocal equivalent of carrying a clipboard.
Cage’s top investigative weapon, though, is Randy Craft, better known to the world as “Rockin’ Randy.” He’s built like an inverted mountain, drives a jacked-up monster truck, and swaps personae like sunglasses. As a professional wrestler he fought Hulk Hogan.
One day, Cage and Craft went out looking for a particular boat, just a small one, as a courtesy to a bank. The owner usually kept it parked inside a shed on his property, but when Cage and Craft showed up the boat wasn’t there, and no one came to the door. Craft left a generic business card on the front door with his mobile-phone number.
Why would a debtor, knowing he’s in default, make such a call? “He won’t,” Craft said. “But she will. He’s probably at work, and his wife will find the card. Men will ignore something like that. But their wives won’t.”
An hour or so later, Craft’s phone rang. The boat owner’s wife had found the card. She sounded guarded, but over the next two or three minutes Craft put on a masterful performance with a rich Southern drawl: “Hey, this is Randy, and I stopped by to look at a boat I thought I saw for sale in the yard there. I didn’t know if you still had it for sale or not. Does your husband have, like, a johnboat for sale?”
The voice grew a little more lively.
“Oh, it’s a Grizzly? No s- - -! I didn’t even realize that. I thought it was a johnboat. Wow.”
The tiny voice on the receiver squawked.
“Really? … Hey, if I wanted to look at this boat, where would I need to go? I stopped by and it was gone, so I thought maybe it had been sold.”
Urgent tones, the eagerness of a woman who is sick of looking at her husband’s boat.
“Well, just out of curiosity—I love bass fishing, nothing better than freshwater—where does he fish a lot, kinda hang out? I mean, does he do a lot of fishing over at Lake Eustis, or …?”
She talked for a moment, warmly now. Craft swung his enormous truck in a new direction.
“Oh, no kidding! How does he get to Norris? I’ve been wanting to fish that lake frickin’ forever and can’t find a way into it …”
By the time Craft hung up she had given a full description of her husband’s secluded fishing camp. He and Cage picked the boat up less than an hour later.
Cage made his reputation by finding a plane about four years ago. He wanted to prove himself to a bank in Western Florida and challenged them: “Give me your toughest job.” Fine, they told him: Find this 1953 Tri-Pacer.
The debtor was a retired policeman who wasn’t intimidated by repo men and refused to give up the plane’s location. Also, he had disappeared. Cage tracked him to a small town in Pennsylvania—just a few miles from the neighborhood where Cage grew up. He called and opened the conversation with, “Hi, I was just wondering if you know Bill Smith?”
The old cop said, “The contractor? Sure. We’re good friends.”
The conversation carried on for another half-hour, the two getting to know each other. Then Cage made a direct approach: “The reason I’m calling is to repossess your plane.” The man fell silent. “All right,” he finally said. “I’ll tell you where it is. It’s in Ohio. But you won’t fly it home.”
When Cage found the plane, he smiled. The old cop was right. Cage returned to the bank and spread photos of the plane across the desk of an eager executive. “There’s your plane,” Cage said. The banker stared. “Where the hell is this?” he asked. Cage answered, “It’s in Cleveland. Hanging from the ceiling at Charlie’s steakhouse.”
Photograph by Gasper Tringale for Bloomberg Businessweek
Recently another bank put in an order for a much more valuable plane: a Citation jet owned by a real estate mogul. It was last seen in Florida, where Cage has an extensive network of informants at area airports. Using the plane’s tail number, he traced it to Orlando International Airport, where that morning it had disappeared from all records. That meant it had been flown without a flight plan. Which meant, according to Federal Aviation Administration rules, it had flown at very low altitude within sight of the ground. So Cage suspected the owner might have hidden it at a small airport in the area.
He and his team fanned out to canvass every little airstrip within driving distance. Eventually his mobile phone rang, and Craft delivered some good news: Someone had spotted an out-of-place jet at Orlando Apopka Airport. So Cage checked the time, toggled his GPS unit, and gunned his Jeep north.
He wanted to reach the jet before it was flown to another hiding place. As he weaved through traffic, his demeanor changed: His eyebrows lowered, his face flushed. He fidgeted with three phones, waiting for bad news of the plane’s departure. His speech tightened. “Come on,” he whispered to the traffic.
The roads grew narrower as he approached the rural airport. It lay behind a tangle of streets and sidewalks with lampposts and curbs but no homes—an aborted real estate development. “Lots of those around here,” Cage said.
Craft rang again: “I see it,” he said. “I think the crew is at lunch.”
A sheaf of paperwork gives Cage the right to seize a bank’s property. At large airports the team might still have to pose as repairmen, or caterers, or prospective buyers to get close enough to a plane without tipping off the debtor or his cronies. Sometimes Cage might pay the debtor’s overdue hangar rental to make an ally of a vigilant airport operator. But this rural airstrip had no security and no control tower, and consisted mostly of a cluster of prefabricated hangars along a thin strip of tarmac. Cage bounced his Jeep over a set of railroad tracks, trying to find the jet. “Where?” he hollered at his phone. “Behind what?”
He skidded around the back of the facility, and there—hidden from the road—sat the jet. Its nose poked into a little hangar, like a big dog trying to hide under a small sofa. Craft had pulled his truck close to the jet to try and block it. Cage’s hired pilots had arrived as well, and stood aside while Craft retrieved his lock-picking kit and approached the plane’s door. “Oh, that’s a Medeco,” one of the pilots said. “You’ll never get into that.”
About two minutes later Craft undid the lock—“Ha-ha!”—opened the door, and lowered a small flight of stairs. While he called the police to let them know what was happening and to expect a call soon from frantic crew members, Cage climbed aboard the jet and looked around. There were no drugs, no guns, no cash. No headaches. He exhaled. “Lots of Coffeemate,” he said.
Outside the cockpit, Craft and another helper retreated to move the big truck and Cage’s Jeep. (Craft recently left the company after he and Cage had a disagreement over participating in a cable-TV reality show.) Inside, the pilots hustled through a preflight check. Their counterparts could return at any moment. The engines whined as the Citation eased onto the short runway. Cage took a closer look around. The interior was well-appointed—walnut and leather—and small clues constructed a picture of the owner’s life. He read the magazines a real estate mogul might: Architectural Digest, Islands, Cigar Aficionado. As the jet rocketed forward, lifting, clearing the hangars and the thick vegetation, and banking south toward Cage’s prearranged hiding place, Cage found the owner’s stash of chewing gum in a seat pocket. The now-former owner, wherever he was, favored Dentyne Ice Arctic Chill in the blister pack. Even rich guys, it turns out, hate it when their ears pop.