Actress Phoebe Cates’ mom invested $5 million with accused fraudster Alberto Vilar on his promise of huge returns – but got nothing more than ignored phone calls and a “run-around,” she testified yesterday.
Ex-model Lily Cates said the cash she gave the once-vaunted financier was half the money she inherited from her late third husband. The deal was struck at Vilar’s plush United Nations Plaza apartment in June 2002.
“We sat in his kitchen, and he made a proposal to me,” said Cates, the prosecution’s star witness. “I was going to be the third partner in a business venture.
“He said we would make more money than anyone ever dreamed of.”
The 70-year-old heiress said Vilar assured her quarterly payments of $250,000 that were supposed to start rolling in that September.
But the aging beauty said she never even got a statement acknowledging receipt of her dough until the following March, after her accountant began raising questions.
Federal prosecutors allege that Vilar stole Cates’ cash and used it for personal and business expenses, as well as to pay off another client of his company, Amerindo Investment Advisors.
The opera-loving money manager made a name for himself as an international philanthropist after striking it rich during the tech-stock boom of the 1990s.
But he was booted off the Metropolitan Opera board after the market went bust and he failed to make good on millions in charitable pledges.
Cates, who is estranged from her famous daughter, never mentioned the “Fast Times at Ridgemont High” star during nearly three hours on the witness stand in Manhattan federal court.
But the still-stunning senior citizen – who wore black slacks and a black sweater, with her gray hair pulled back in a bun – wept while discussing the death of her third husband, longtime United Artists chairman Marshall Naify, just seven months after they married in 1999.
Cates also told jurors that she suffers from dyslexia that leaves her unable to spell or even balance a checkbook, and she struggled with exhibit numbers during questioning by prosecutor Marc Litt.
Cates said she began investing with Vilar in 1987, shortly after divorcing TV game-show and Broadway producer Joseph Cates, because her then-accountant had poured $10,000 of her money into a Broadway play without permission.
She said she gave Vilar about $1.4 million – and later another $800,000 – that ballooned to more than $18 million before losing half its value when the tech bubble burst.
After her testimony, Cates introduced herself to a Post reporter, saying she was an avid reader despite her dyslexia.
“I read Cindy Adams – who’s a friend of mine – and Liz [Smith],” she told the reporter.
“I wouldn’t know what my kids are doing if I didn’t read The Post.”