CNBC - On The Money

Dylan Ratigan, Host:
This man turned an idea into a multi-billion dollar company, it has a market cap of sixty-five billion dollars and Larry Ellison, of Oracle is now the fifth richest guy in the world, according to Forbes.

Guess what? He's also in debt! A lot of debt! Perhaps, perhaps he went over ka-ching. NBC's Michael Oku, tonight, on a really big spender!

[Begin clip of report by Michael Oku]

Michael Oku, Reporter (voiceover):
Fifth on Forbes Magazine's richest list, Oracle founder, Larry Ellison, is a full-throttle, no-holds-barred, big-time spender.

On the list of his purchases, a Japanese-style villa in Northern California-rumored price tag…two hundred million. And filled with lavish trinkets and treasures. How about a racing yacht…new, for a cool a-hundred and ninety-four million.

Michael McAuliffe, President, Family Credit Counseling Service:It doesn't matter if you make a hundred million, a hundred thousand, or twenty thousand…you can really get into trouble.

Oku (voiceover):
According to newly disclosed court documents obtained by the San Francisco Chronicle, four years ago, Ellison spent himself into a mountain of debt. Prompting his own financial advisor to warn him to curb the spending, diversify his portfolio by selling Oracle stock…or face a crisis.

According to The Chronicle, between 2000 and 2002, Ellison advisor, Phillip Simon, wrote the entrepreneur a flurry of e-mails, saying…"I'm worried, Larry, it's imperative that we start to budget and plan. View this as a call to arms".

In a deposition, Simon said, "We have a freight train going down a track, hitting a dead wall". According to The Chronicle, Ellison wracked up more than a billion dollars in debt, with five banks, as recently as 2000-using Oracle stock as collateral.

McAuliffe:

That stock starts to drop, you've got real problems on your hands!

Oku (voiceover):
Oracle declined to comment. The documents stem from a 2001 shareholder lawsuit against Ellison. Accusing him of acting on inside information, when he sold twenty-nine million Oracle shares, ahead of disappointing earnings…for nine hundred million dollar profit.

The suit was settled in November, but it's being appealed by a shareholder. A rare look into the finances of a mogul. And a message…even billionaires need to budget. On the Money, Michael Oku, NBC News, Los Angeles.

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