The man best known for losing more money on Wall Street than anyone else before the 1987 stock market crash stands to lose $27 million more and what’s left of his reputation, if a federal court believes the allegations in an explosive new lawsuit filed against him and a gaggle of so-called conspirators in Brooklyn federal court on Thursday.
In the complaint, three Florida women, filing under pseudonyms, have accused 62-year-old Howard Rubin of leading an organized human-trafficking ring in which he allegedly employed women to lure models to his $8 million Manhattan Penthouse under the guise of a photoshoot or companionship. Once there, the women claim, he led them into a sex-dungeon where he subjected them to sexual assault, rape, false imprisonment, and beatings so severe they would lose consciousness and one had to undergo reconstructive surgery to repair her breasts.
The women—who also say Rubin and his co-conspirators threatened them to keep quiet following the alleged assaults—filed their suit under the Racketeer Influenced and Corrupt Organizations Act, a law originally created for prosecution of members of the mob.
According to the lawsuit, Rubin’s scheme went like this:
Stephanie Shon, a 29-year-old former model and current account manager for a legal support services company, would reach out to bikini models and exotic dancers on Instagram and say something to the effect of, “My boss wants to meet you.” Shon then allegedly offered the the women $2,000—no strings attached—to fly to New York and meet with Rubin in his Manhattan apartment. If Rubin “liked her,” they might take some naughty photos, but nothing too extreme, and he would pay her an additional $3,000. Rubin just liked hanging out with Playboy models, Shon said.
If Shon, a leggy, honey blonde in her photos on social media (she deleted her accounts this morning) couldn’t seal the deal, then Jennifer Powers, a former Hawaiian Tropic model who had once dated Rubin and was now in his employ, would follow up with messages assuring them that he was “a great guy,” and that the trip “would not be about sex,” according to the complaint.
The plaintiffs in this case say that they agreed to meet Rubin at his 57th Street high-rise, in an apartment decorated with photos of Rubin and Playboy Playmates. Before they could meet the retired fund manager, they were told they’d have to sign non-disclosure agreements. And so they did.
When they returned to the apartment after a pleasant if uneventful dinner, a door that had been locked previously was now ajar. The room, later referred to in the complaint as “the dungeon,” had white carpet and red walls. The room was filled with ropes and chains, face masks with zippers, metal hooks and various sex toys, and a large x-shaped machine.
According to the women’s complaint, what happened in that room over the next hour was non-consensual. They say they were restrained against their will, beaten—with Rubin’s fist and various objects—and raped. Rubin then allegedly left, walking to the apartment he shares with his wife, with whom he has three children.
The complaint goes on to tell the story of several more terrifying encounters in Rubin’s apartment—some involving the same women from the first incident (it is unclear why they continued to visit Rubin). Allegations against Rubin include that he gagged, punched, and in one instance used a cattle prod to rape the women he hired. During another session, he is accused of beating a woman’s breast so badly that her implant “flipped,” exposing the closure and requiring reconstructive surgery—which Rubin later allegedly paid, through Powers.
Rubin, Powers, and Shon did not return requests for comment. Reached by email, Rubin’s lawyer Yifat Schnur (who is also named as a defendant for allegedly crafting the NDAs and trying to silence the women after the fact) replied with a statement that read in part, “Mr. Rubin denies all of the fabricated allegations made by Plaintiffs. Plaintiffs’ complaint is part of an elaborate attempt to extort my client. We have contacted all appropriate law enforcement agencies including the Federal Bureau of Investigation.” Schnur further alleged that another individual had been “arrested and charged” in the so-called extortion scheme, but would not elaborate.
The women’s lawyer John G. Balestriere, also responded in an email saying his team welcomed the involvement of law enforcement, as his clients “not only have significant civil claims but are victims of crimes.”
Further, he wrote, “Schnur’s statement that this is extortionist is nonsensical: all defendants’ names are now public since we have filed. How can we possibly extort anyone?”
Rubin, a Las Vegas card-counter and Harvard graduate who was featured in Michael Lewis’ bestsellers Liar’s Poker and The Big Short, was fired as the head mortgage trader at Merrill Lynch in 1987 after his unauthorized trades were blamed at least in part, for the loss of $377 million of the firm’s money.
According to the lawsuit, this most recent scheme has “caused many millions of dollars in damages to dozens of women over the years.”