gang-intervention program, employing hundreds
of felons—Boyle calls them his “homies”—at a
café, a silk-screen shop, and other small businesses, and offering services such as free tattoo
removal, GED classes, and counseling to thousands more. Boyle had become famous, even by
Los Angeles standards. (Periodically, tourists will
peer into his office and snap his picture, or ask
him to sign a copy of his 2010 best-selling book,
Tattoos on the Heart: The Power of Boundless Compassion.) Still, he remained Father G, addressing
his employees as “son” and “kiddo,” “dawg” and
“mijo,” and marrying them, and baptizing their
children—and, sometimes, burying them. He
stayed in the same room in Boyle Heights, a converted garage of a Jesuit group house, with just
enough room for a mattress on the floor and a
shelf for his books. And he still gave his cell-phone
number to every hard case he met. “Blow it up,”
he says, and they do.
Boyle describes Homeboy as a place of miracles. More than a few times, that has extended
to its finances. Once, a day or two away from
failing to make payroll, Boyle found an elderly
woman at his door with a paper bag full of cash,
thousands and thousands of dollars. In those
days, Homeboy was small enough that a bag of
cash could cover a shortfall. But by 2010, it had
an operating budget of nearly $10 million, and
its cash reserves had been dwindling for months.
On a Thursday just after lunch, two years ago
this month, employees filled Homeboy’s lobby,
and the stairway, and peered down over the railing from the second floor. They grew quiet. Boyle
told them that Homeboy was out of money.
Most of them were going to lose their jobs. And
Home increased home sales by nearly 1,000%, bringing in $9.4 billion
in revenue in 2005, his last full year as CEO. For his efforts, Karatz paid
himself a staggering amount. In his final year at KB Home, he made, by
Forbes’s count, $135.53 million.
Then came the investigation. In 2006, the Securities and Exchange
Commission began to crack down on the practice of backdating stock
options. Karatz’s board found irregularities with stock transfers he’d
authorized, worth roughly $36 million. He was fired, and the SEC opened
a criminal investigation. Ultimately, in April of 2010, a jury cleared him
of intentionally manipulating stocks but found him guilty of obscuring
the accounting, a felony.
“We ought to share a common anguish over the crisis that threatens
to cripple Homeboy Industries,” columnist Tim Rutten wrote in the Los
Angeles Times a few weeks later. Then Rutten quoted former L.A. mayor
Richard Riordan, a wealthy man and a Homeboy supporter: “There’s no
question Greg Boyle is a saint, but even saints need good businessmen.”
Karatz had never thought much about incarceration, until recently,
or about gangs. But he was a businessman, and he was anxious for
something to do, something to keep him from dwelling on his future.
Oddly enough, he had plans to meet Riordan later that morning for a
bike ride up the coast.
The next day, Carol Biondi’s cell phone rang. Biondi, a longtime
Homeboy board member and the wife of Frank Biondi, the former Via-com CEO, was in a Las Vegas boutique, shopping with Edythe Broad,
Eli’s wife. It was the former mayor calling. He wanted to introduce Karatz
I paid a visit to Homeboy last summer. Sunlight filled the lobby. Dozens
of young men, and some women, sat in rows or loitered outside. Most
were garishly tattooed. Boyle appeared, and the men gathered around
him, three or four deep, for a hug, or a whispered blessing: “You are
exactly what God had in mind when he made you.” Karatz sat nearby,
thumbing at his BlackBerry, in trim gray jeans and a dark sport coat.
He had been coming in pretty much every day now, for more than a year.
OPPOSITE PAGE The
Homegirl Café, on the
first floor of
Homeboy’s L. A.
and dozens of homies
who have found
THIS PAGE Bruce Karatz,
the former KB Home
CEO, found new shelter
at Homeboy, which he
has helped put on
firmer financial footing.
Bruce Karatz read about those layoffs in the paper. He was at his weekend home in Malibu, with
his wife, Lilly Tartikoff, the widow of former NBC
Entertainment president Brandon Tartikoff.
(Karatz’s previous wife, his second, was Sandra
Lee, the Food Network personality.) Karatz had
plenty of time to read the paper. Too much time,
for his liking.
Three weeks earlier, a jury had found him
guilty of four felonies. It was possible the judge
would sentence him only to parole. It was also
possible that, at 64, he could spend the rest of
his life in federal prison. He would not know
From 1986 to 2006, Karatz was CEO of KB
Home, cofounded in the 1950s by a young accountant named Eli Broad. Karatz grew Broad’s
first company into one of the world’s largest home
builders. During Karatz’s time at the helm, KB