Opulent dream turns to dust

Brokerage: Coleman Craten glittered with style and the promise of prosperity. Now the firm is mired in litigation, and its marble-floored building stands empty

May 12, 1999|By Sean Somerville | Sean Somerville,SUN STAFF

By now, well-dressed patrons should be crowded around the 13 stools at the Coleman Craten Financial Club mezzanine bar looking for their stocks on the CNBC ticker.

Clients should be talking about retirement plans over spinach-and-Swiss quiches or sifting through annual reports downstairs for the latest investment bargains.

None of that is happening. Not these days. The offices of Coleman Craten are more like a ghost town.

Coleman Craten LLC, which touted financial planning, brokerage services and a stately financial club when it moved into 7 E. Redwood St. in downtown Baltimore late last year, appears dead. The company is at the vortex of about 10 lawsuits alleging the same thing: that Coleman Craten owes a lot of people money.

The latest developments came yesterday, with Coleman Craten LLC's filing for Chapter 11 federal bankruptcy protection and the Maryland securities commissioner accusing Monica Coleman and the company of violating securities laws and ordering her to cease and desist from further securities activities.

Several investors, including James R. Hyde, declined to comment or return telephone calls yesterday seeking comment.

"Mr. and Mrs. Hyde are hurt, angry and outraged at this breach of trust that is seriously complicating their retirement plans," said Nancy Alquist, a lawyer who represents the Towson family, which has accused Coleman and the company of embezzling more than $2 million.

Those suing Coleman Craten include Hyde, a W. R. Grace executive, company co-founder John G. Craten and Dr. Shahid Aziz, a Howard County physician -- professionals who would not be regarded as the type of naive investors ordinarily targeted by boiler-room operators.

Then again, Coleman Craten was never a boiler-room operation. The company, established in February 1998, refurbished six stories, or more than 32,000 square feet, in the 1920s-era building -- $1.3 million for marble floors, leather chairs and crown molding.

"To be perfectly honest, it was a little overdone," said a former broker.

On the first floor, bookshelves appear stacked with documents; about 10 leather sofas and chairs face each other. Grand columns soar two stories. Huge chandeliers hang from the ceiling.

One flight up, on the mezzanine, four large television sets perch above a beautiful bar and about a dozen tables.

"Broker of the day area," says one sign. "If a member wants to see a broker, he need only to inform an information clerk or page who will locate the member's broker or someone equally experienced."

But yesterday at Coleman Craten, there were no pages, no information clerks and certainly no brokers. The second floor was locked and inaccessible.

The three floors above that were supposed to house the brokers and other financial professionals were empty. There are no desks, no phones and almost no furniture.

What remains are more than 42 glass-enclosed window offices with views of Light and Redwood streets, golden-yellow walls topped with white crown molding, hardwood floors, more than 70 mail slots, brass light fixtures everywhere and signs on every floor that announce in gold letters: CC Coleman Craten.

At one point, all the luxury seemed promising. In November, when clients saw the renovated building, they thought it suggested that Coleman and Craten were building a solid company, a former employee said.

"The attitude was great," the employee said. "Customers were impressed."

At executive committee meetings, the new brokers would meet in a luxurious conference room near a lunchroom intended to resemble a Wall Street deli, a former employee said. When the company peaked, with about 25 people in November, Coleman talked with promise about potential new hires.

But to another former employee, all the talk and all the luxury seemed suspicious. The walls on several of the floors were sponge-painted, elevators were hand-painted. "These were artists," the employee said. "They weren't painters."

Coleman ordered big leather chairs, for brokers and their clients, and large wood desks with fancy leather inlays. "She said her adviser at [advertising company] Saatchi and Saatchi told her the atmosphere had to be rich to attract clientele," a former employee said.

Now in various lawsuits, Constantine Construction, which worked on the building, is seeking more than $300,000 in unpaid bills. A broker seeks more than $500.000. Investors seek more than $3 million.

"It was so unrealistic," one employee said. "But people kept saying this was her `vision.' "

Pub Date: 5/12/99

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