by Gwen Moritz on Monday, Sep. 30, 2002 12:00 am 12 min read
(Editor's Note: This is the latest in a series of business history feature stories. Suggestions for future “Fifth Monday” articles are welcome. Please contact Gwen Moritz at (501) 372-1443 or by e-mail at firstname.lastname@example.org.)
A violent thunderstorm and a creepy old house, a famous mother who had literally portrayed the devil, a methodical killer wearing a Halloween mask: Despite dramatic elements that would tax a B-movie screenwriter, one of the strangest business-related crimes in recent history has very nearly faded from view.
The case of Ronald Gene Simmons, who shocked the nation only six weeks later by slaughtering 14 members of his family and two former co-workers in Pope County, is detailed in two books and innumerable articles available on the Internet. Two books also were written about the murder of Little Rock socialite Alice McArthur five years earlier.
The murders of three West Memphis boys in 1993 inspired two critically acclaimed documentaries and celebrity support for the three youths convicted of the killings.
But as the 15th anniversary of the deaths of John, Christina, Amy and Suzanne Markle nears, the only lingering attention comes from a handful of conspiracy theorists who insinuate — but never quite allege — that Bill Clinton or Jack and Witt Stephens may have been involved in the annihilation of the prosperous Little Rock family. (See story here.)
Weeks of investigation confirmed what seemed obvious as soon as the crime was discovered. John Markle left a short suicide note in which he acknowledged killing his wife and two young daughters. He dated and timed the note and called his attorney barely a quarter-hour before his body was found, answering the question of when. Three handguns containing 14 spent shells explained how.
It would take a few more days for the Little Rock Police Department to determine that the discovery of his risky embezzlement scheme had motivated Markle, a 45-year-old futures trader for Stephens Inc., to destroy his family and himself. It would be four years before all the subsequent litigation was resolved.
Fifteen years later, the Stephens organization declines to add any information to the public record on the Markle case, except to say that more sophisticated controls are now in place that would prevent a similar scam.
As far as the public was concerned, the Markle case began at 4 a.m. on the stormy morning of Nov. 16, 1987. That’s when John Markle telephoned his attorney, Richard Lawrence, and in a brief conversation asked him to come right away to the Markle home: a somber Victorian at 1820 Main St. in the historic Quapaw Quarter.
Lawrence, having an insider’s knowledge of turmoil in Markle’s life, twice tried to call Markle back before setting out, but he got no answer. At 4:10, he called the Little Rock Police Department and asked the dispatcher to send an officer to the Markle house.
A lightning strike darkened the street lights outside the house as Lawrence drove up. All that was visible was a small light in a downstairs window. The storm had been disrupting police radio transmissions, which may be why no patrol car had responded to Lawrence’s request.
He spotted two police cars in the parking lot of the nearby Safeway supermarket (now a Harvest Foods location), and he asked one of the officers to accompany him to the house.
The storm door was unlocked and the front door was slightly ajar, so Officer Jeffrey Armstrong walked in. He found Markle’s dead body in a downstairs study. The time was 4:17 a.m.
Within minutes, the bodies of Amy Michelle, 13, and Suzanne Marie, 9, were found together on the bed in Amy’s second-floor bedroom. The body of Chris Markle, who had turned 45 the previous week, was found on the waterbed in the master suite that occupied the entire third floor of the house.
In the study near Markle’s body were a Western-style .45-caliber Colt revolver and a .38-caliber Charter Arms revolver. The third murder weapon, a .38-caliber Colt revolver, was found in an upstairs bathroom. (Fifteen other firearms were recovered from the house, but they apparently weren’t used that night.)
Also near John’s body was a rubber “old man” Halloween mask spattered with blood, and on the desk in the study was a note handwritten on a pad of yellow legal paper. The date and time — “11/16/87 at 2:30 a.m.” — were written on the note. Otherwise, all it said was:
“Let it hereby be stated as true that I, John L. Markle, murdered my wife, and two children, Amy and Suzanne, and then committed suicide myself. My wife had no knowledge or part in this. I think the evidence shall so prove.” It was signed “John Markle.”
In the hallway next to the study was a black briefcase. Attached to it was a note to Lawrence. Inside were:
• two letters to Lawrence marked in the order in which he was to read them;
• a long letter to Markle’s mother;
• 64 $100 bills;
• a $5,000 cashier’s check;
• a spiral notebook;
• a handwritten will; and
• assorted personal papers such as car titles and birth certificates.
News reports at the time couldn’t resist such details as the video of “A Nightmare on Elm Street” that was in the family’s VCR and the copy of “Bouquet For Murder,” the first book about the 1982 murder of Alice McArthur, that was found in the home. The book probably had no real significance; the scary movie may have explained why Suzanne was sleeping with her sister rather than in her own bedroom.
Police investigators would conclude from blood analysis that Markle wore the rubber mask as he shot Amy four times, and probably while he put five bullets in Suzanne and three in Chris. A couple of hours later, he phoned Lawrence and then shot himself in both sides of his head simultaneously using the revolvers that were found with his body. That no one in the neighborhood reported hearing more than a dozen gunshots was explained by the thunderstorm.
Lab tests would reveal that all four Markles had trace amounts of Elavil, an antidepressant that causes drowsiness, in their systems. John and Chris both tested positive for Valium and marijuana, and John also had ingested an appetite suppressant and a small quantity of alcohol.
John Lawrence Markle was born early on Christmas Day 1941 in Hollywood, Calif., to Mercedes McCambridge, a 23-year-old radio actress, and her husband, writer William Fifield. When John was 8, McCambridge would win the Academy Award as best supporting actress for her screen debut in “All the King’s Men,” a political drama that was also named the “best picture” of 1949.
By then, her marriage to Fifield was over and she was married to Fletcher Markle, a film and TV director who adopted her young son.
Despite an erratic Hollywood upbringing, John Markle was a brilliant if eccentric student. He earned his master’s degree in economics from the University of California at Los Angeles in 1968. He and Christina married in July of that year.
John joined Salomon Brothers in Dallas in 1972, the same year his mother was nominated for a Tony Award for her Broadway role in “The Love Suicide At Schofield Barracks.” The next year, Markle received his Ph.D. in economics from UCLA. Also in 1973, Mercedes McCambridge performed as the voice of the demon in the classic horror film “The Exorcist.”
The Markle family was lured to Little Rock in 1979 by Stephens Inc., where John was the firm’s economist and one-man futures-trading department. He handled a corporate account for the firm’s founders, Jack and Witt Stephens. A few months before his death, Markle told Forbes magazine that he had no position limits that he knew of. At one point, he boasted, he could put $800 million on the line without consulting a committee.
At Stephens Inc., his pessimistic view of the American economy earned him the nickname “Dr. Doom” — indeed, he had his greatest trading success when interest rates were on the rise in the early 1980s.
Markle’s idiosyncrasies were legendary: He was described as temperamental, rude and “socially retarded”; he favored purple shoes; he insisted on wearing a leather Harley Davidson cap while trading and required his assistant to wear a particular hat as well. He threatened to kill a co-worker with an AK-47 and later loaded his arsenal of guns into the trunk of his car to prove that he could make good on the threat.
But he wowed his employers by generating at least $3 million in trading profits during the first three years of his employment. He was made a vice president after only eight months, the fastest ascension in Stephens history, and he answered only to Jack Stephens, who would later admit that he knew little about the type of futures trading that Markle was doing. Rumors that he was mishandling accounts were never pursued, mainly because Markle was a frequent target of unflattering gossip.
The Markle family lived in North Little Rock for a short time before purchasing the renovated house on Main Street for $125,000 in 1980. When he applied for a home improvement loan in January 1987, he listed his annual income as $140,000 — $135,000 in salary and $5,000 in dividends and interest income.
He and Chris and their two little girls settled into the community. To be near them, McCambridge, long divorced from Fletcher Markle, moved into the Quapaw Towers for a couple of years beginning in 1981. In 1986, she played the mother of a suicidal daughter in the Arkansas Repertory Theatre’s production of “’Night, Mother.”
The Markle girls attended The Anthony School for a while, and at the time of their deaths Amy was enrolled in Mann Junior High and Suzanne was in fourth grade at Gibbs Magnet School.
The Markles were financially secure and had a number of close friends, but theirs was clearly not a picture-perfect family life. In August 1986, John was arrested in Little Rock and charged with soliciting a prostitute. The charge of solicitation was dropped, but he pleaded guilty to public intoxication. Marijuana was apparently a regular part of John Markle’s life.
After the killings, the police investigation would show that Markle routinely cashed three or four checks totaling $600-$1,000 a week. “Where this cash was spent would be purely speculative,” Detective Michael Roche wrote in his case summary.
John Markle was also a heavy smoker whose high-stress lifestyle led to a sextuple heart bypass surgery when he was 43.
Richard Lawrence told police in a written statement that his client “would like to get things done right away instead of putting it off. But I didn’t believe his problems would put him in a life or death situation.”
On Tuesday, Nov. 17, the day after the bodies were discovered, readers of the competing Arkansas Gazette and Arkansas Democrat learned that Markle had been on “medical leave” from his job at Stephens Inc. since early October. That was the company’s official statement, but it wasn’t the whole truth.
After a memorial service at Trinity Episcopal Cathedral the following Thursday, Stephens Inc. came clean: Markle had been placed on medical leave on Oct. 7, but his employment had been terminated the previous Friday, Nov. 13.
KARN radio station scooped the newspapers by reporting that the murder-suicide was related to discrepancies in Markle’s handing of accounts belonging to Stephens Inc. and his mother. The station didn’t reveal its source and its information was sketchy, but the radio report was the first to pinpoint the motive behind what Pulaski County Coroner Steve Nawojczyk would call “an act of macabre benevolence.”
The official report released by Little Rock Police Chief Jess F. “Doc” Hale on Dec. 4 would describe Markle’s risky five-year operation and its accidental discovery. (Five months later, after being accused of a petty theft, Hale would take his own life.) More details of Markle’s embezzlement would emerge through court documents and testimony.
Simply put, Markle would order trades through a Chicago brokerage, Geldermann’s Inc., without specifying whether the trades should be entered on the Stephens house account or on an account he had opened for his mother in 1982. At the end of each trading day, Markle would assign profitable trades to his mother’s account and losing trades to the Stephens account.
Such “post-allocation” was a blatant violation of Chicago Board of Trade rules and Stephens’ internal policy, but some Geldermann’s employees apparently were willing to bend the rules for a “good customer.” In fact, Markle probably was using the same system even before he joined Stephens in 1979, and he apparently chose Geldermann’s because a helpful friend had gone to work there.
The Stephens house account lost $5.2 million during the time that Markle controlled it — more than $1.3 million in the first 10 months of 1987 alone.
His performance for the company was the worst among Stephens traders in 1987, but 91.7 percent of trades in his mother’s account were profitable — a record that was literally too good to be true. The only losses in the McCambridge account were trades in precious metals, a commodity in which Stephens didn’t deal, so those losses couldn’t be assigned to the Stephens account.
There was no evidence that McCambridge knew of the scheme. She believed the $604,000 she gave her son to manage in 1982 was invested in safe Treasury bills and money markets — definitely not in commodity futures, which lose more often than they win. Instead, her signature was forged on the application and power of attorney that Markle used to set up and manage the account.
Over time, another $500,000 would be deposited in McCambridge’s account, for a total investment of about $1.1 million. Meanwhile, $1.18 million would be disbursed from the account — some to McCambridge, some to Markle and some that could not be accounted for because of incomplete documentation.
One of Markle’s contacts at Geldermann’s moved to another Chicago firm, Elders Futures Inc., and Markle began moving both the Stephens and McCambridge accounts from Geldermann’s to Elders in September 1987. That’s when the embezzlement scheme began to unravel.
Geldermann’s had been careful to mail all statements about McCambridge’s account to Markle’s home, but Elders sent a statement on the new McCambridge account to Stephens Inc., where it caught the attention of Bruce Bennett. Bennett questioned Elders about the previously unknown account for Markle’s mother, and on Oct. 6, a Geldermann’s officer revealed the existence of a McCambridge account at his firm as well.
Since that account was also a secret to Stephens Inc., compliance officer Phil Shellabarger immediately began an investigation. The following day, he and other Stephens representatives confronted Markle, who initially denied any wrongdoing but later admitted diverting profits to his mother’s account.
Because of his history of heart disease, he was placed on medical leave while his accounts were reviewed. A few days later, he was relieved of his key to the Stephens offices and his access to company computers was cut off.
Markle came up with at least two different ideas for making restitution to his employer in order to avoid criminal prosecution, both of which would have required his mother’s cooperation. And that proved to be the sticking point.
When the embezzlement was discovered, his mother had approximately $1.2 million between the two accounts at Geldermann’s and Elders. Markle originally offered to leave all her money on account with Stephens Inc.; McCambridge would draw interest from the account during her lifetime, and the balance would revert to Stephens on her death.
Markle seemed to believe that Jack and Witt Stephens and Jack’s son, Stephens Inc. President Warren Stephens, were amenable to this solution. But McCambridge was not — even though she had been friendly with the Stephenses, especially “Mr. Witt,” while she lived in Little Rock and, as Markle pointed out in a bitter letter to his mother, it wouldn’t have cost her anything.
McCambridge also apparently rejected Markle’s second idea for reimbursing his employer: $600,000 in cash and the remainder of her estate at the time of her death.
Instead, on Oct. 21, McCambridge sent telegrams to the three Stephenses in which she denied any wrongdoing and even suggested that Stephens Inc. owed her money.
On Nov. 11, Stephens Inc. finally received an accounting of the Geldermann’s transactions and the extent of the company’s financial loss became more clear. According to Police Chief Hale’s final report, Warren Stephens demanded $1 million in restitution during a final meeting with Markle on Nov. 13.
“Mr. Markle seemed to believe this was a good proposal,” Hale reported, and he requested 30 additional days to come up with the money.
But days before that last discussion, Markle had contacted his life insurance company and confirmed that his $500,000 policy would be paid in case of suicide. His diary suggested that while he was making preparations for what he called “option ?,” he hadn’t firmly decided to kill his family and himself until he heard Stephens’ final offer.
On Nov. 9, Markle voided the will he had executed a few months after his heart surgery in 1985, and he, two witnesses and a notary signed the handwritten will that was found in his briefcase. Unlike the first will, the new one made no provision for Chris and named no guardians for Amy and Suzanne.
In the new will, he estimated the net value of his estate at $890,000. He left $500,000 to his mother, which would bring her cash assets to approximately $1.7 million. His letters to her and to his attorney, Richard Lawrence, encouraged McCambridge to immediately pay Stephens Inc. $700,000, leaving her with $1 million to invest for income.
But Markle didn’t foresee all the legal questions that his deadly actions would cause. Eight lawsuits would be filed by his estate, Christina’s estate, two life insurance companies and McCambridge. Christina’s estate even suggested that she may have outlived John, which would have completely changed the chain of inheritance and settled a third of John’s estate — as well as Chris’ $250,000 life insurance policy — on his wife’s surviving sisters.
Eventually all eight lawsuits were settled out of court with a single, confidential agreement. This much is known: Three insurance policies on John Markle’s life totaling just over $653,000 were distributed in December 1988; $549,000 went to Markle’s estate, and McCambridge and her former husband, Fletcher Markle, each received $52,000.
Markle’s estate also sold the house and auctioned off many of the family’s personal effects.
Meanwhile, Stephens Inc. was pursuing numerous legal complaints against Markle’s estate, McCambridge and Geldermann’s. In out-of-court settlements, Stephens received $600,000 from McCambridge and $340,000 from Markle’s estate.
Stephens Inc. and McCambridge jointly sued Geldermann’s, arguing that Markle never could have managed the embezzlement scam without the Chicago company’s cooperation.
McCambridge sought $500,000 in actual damages — the difference between the $1.1 million she had given Markle to invest and the $600,000 she wound up with after settling with Stephens — plus $1 million in punitive damages for allowing Markle to set up an unauthorized account in her name. Her claim against Geldermann’s eventually was dismissed.
Stephens Inc. sought $6.2 million in compensatory damages — $5.2 million for all the losses Markle racked up in Stephens’ house account over the five-year period, plus almost $1 million for commissions paid to Geldermann’s during that time — and an equal amount in punitive damages.
Geldermann’s acknowledged that some employees had facilitated Markle’s scheme by allowing him to “post-allocate” the trades. But Geldermann’s argued during a three-week trial in December 1990 that only $854,000 in profits was skimmed from the Stephens account and that even that could have been prevented if Stephens had supervised Markle adequately.
“Jack Stephens trusted Markle and made a mistake,” Little Rock attorney O.H. “Bud” Storey, who represented Geldermann’s, told the jury.
The jury awarded Stephens actual damages of just under $1.4 million, plus $1 million in punitive damages. The court reduced the actual damages by $940,000 since Stephens had recouped that much through its settlements with McCambridge and the Markle estate, but appeals that stretched into 1991 failed to win reduction of the punitive damages.
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