Michaels put $40 million into animal causes, but was convicted of toner cartridge scam that netted more than $126 million, according to the federal Department of Justice.
VAN NUYS, California––Gilbert N. Michaels, 80, founder of the Compassion for Animals Foundation and Animal Guardians, died on August 19, 2022, while on compassionate release from a four-year federal penitentiary term.
Michaels suffered from multiple medical conditions, including chronic obstructive pulmonary disease.
The irony of Michaels’ life and death was that among dozens of people involved in animal advocacy who might richly deserve to be convicted of mail fraud after bilking millions of donors and pocketing multi-millions of dollars raised under false pretenses, Michaels was convicted of mail fraud after donating nearly $40 million to animal advocacy projects, never paying himself a cent raised to help animals.
Founded financial services firm in 1974
Michaels, growing up, fantasized about emulating Hall of Fame second baseman Red Schoendienst, then starring for the St. Louis Cardinals and Milwaukee Braves, but eventually realized he was small for a ballplayer and refocused on business. In September 1974, at age 28, he formed Gilbert N. Michaels Financial Services, the umbrella for many other business ventures undertaken during the next 48 years.
Prospering, Michaels for about a dozen years raised a family with first wife Nola Fox Michaels, and was known mostly for conspicuous consumption.
That began changing in August 1986, Natalie Nichols recalled for Cityside three years later, after Gil Michaels’ son “brought home a videotape called Faces of Death.”
Explained Gil Michaels, “The atrocities that were committed to animals on that tape were both enraging and heartbreaking. I couldn’t believe that mankind was doing these sorts of things to animals.”
Gave up meat, fur, & leather in 1986
Resumed Nichols, “At first, Michael’s new consciousness manifested itself only in his personal life.”
Remembered Gil Michaels, “September 16, 1986 was the last time I ate red meat. It was my son’s birthday, and it was a tradition for me to take him and his buddies to dinner. We’d all have hobo steak. By that time, my appetite for hobo steak wasn’t what it used to be. I decided that night to stop eating red meat. Later I stopped eating chicken and other fowl as well.”
“Michaels also stopped wearing his fur coats and leather goods, and even had his car’s leather upholstery replaced,” Nichols narrated. “But the lifestyle changes weren’t enough for him.
“In December 1986, Michaels created the Compassion for Animals Foundation, through which he funded various animal rights projects. Toward the middle of 1987, however, he decided that he wanted to start local projects of his own.”
Backed The Animals Voice
“I came across Laura Moretti, who had a tiny magazine in Chico, California, called The Animals’ Voice,” Gil Michaels said.
Gil Michaels became publisher, Nola Michaels became publicist, and over the next six years they poured more than a million dollars into trying to make The Animals’ Voice into a popular slick magazine.
Gil Michaels told Nichols that their ambition was to “reach outside the movement” to the general public. The Animals’ Voice did develop a dedicated following within the animal rights movement, but glossy images of animals suffering never appealed to a mass audience.
Michaels, going through a divorce, in 1992 pulled the plug on his support of The Animals’ Voice. Unable to raise funds enough to continue publishing in a slick printed format, Moretti eventually continued The Animals’ Voice online.
Michaels by then had met his second wife, Holly LaRue, a southern California horse trainer.
“Gil and Holly….1992-2022,” LaRue mused online upon receiving word of his death. “Those of you who knew him would agree that he was not an easy man, but he had a generous heart and we laughed a lot! Our whole relationship was 30 years, including marriage for a handful of years in the middle of it all. Gil retired his last two horses with me, aged 29 and 30!,” LaRue told her followers, posting photos and video of Gil Michaels with the horses.
“Although he was my former husband, we remained close for 30 years,” LaRue said.
Financier of animal advocacy abroad
Turning from publishing to grantmaking, Gil Michaels by 2007 was among the major financiers of animal advocacy abroad, especially noted for donating huge sums at fundraising events on condition that they be matched by some of his affluent celebrity friends.
Reporting for the Los Angeles Times, former People for the Ethical Treatment of Animals staff writer Carla Hall on December 19, 2007 described how Gil Michaels donated $25,000 to help raise $50,000 for elephant researcher Joyce Poole, and “spent more than $50,000 in September 2007 at a gala for Farm Sanctuary.
“Michaels estimates that he has donated more than $30 million to animal-related causes over the years,” wrote Hall. Gil Michaels would donate another $10 million during the rest of his life.
Business interests took Gil Michaels to Sichuan province, China. After a major earthquake devastated the region on May 12, 2008, Michaels was among the first to fund the Animals Asia Foundation rescue effort.
Still active in the U.S., Gil Michaels donated $31,000 to animal-friendly candidates during the 2008 national election cycle.
Disillusioned with big groups
But Gil Michaels as far back as 2004 had become intensely critical of the major national and international animal advocacy organizations. A turning point in Gil Michaels’ perceptions was the weak response of the “movement” to the crude and clumsy mass killing of chickens in response to outbreaks of the H5N1 avian influenza, chiefly in southern California.
Asked Gil Michaels in March 2004, “Where are the Humane Society of the U.S., Farm Sanctuary, Compassion in World Farming, the Humane Farming Association, United Poultry Concerns, People for the Ethical Treatment of Animals, the ASPCA, In Defense of Animals, the Animal Legal Defense Fund, the World Society for the Protection of Animals, etc, etc. Why aren’t they ‘squawking’ about this instead of negotiating with the United Egg Producers?”
United Poultry Concerns and the Humane Farming Association, neither of which ever negotiated with United Egg Producers, eventually got out of Gil Michaels’ doghouse, or henhouse, as did Farm Sanctuary, after demonstrating signs of life in response to the mass poultry killing, but Gil Michaels apparently never forgave the rest.
Key source for ANIMALS 24-7
Only two weeks after ANIMALS 24-7 debuted, in mid-April 2014, Michaels––almost always insisting on anonymity––had become one of our most valued inside sources on animal advocacy politics.
“Is Maddie’s Fund full of shit or what?” Gil Michaels fumed in response to our first exposé of the $300 million foundation’s grant-making ineptitude. “They have more money now than they did when Dave and Cheryl Duffield put up the $250 million in 1998 to take the U.S. to no-kill animal control How long ago was that? They should spend the money, not sit on it,” Gil Michaels opined.
Another of the first ANIMALS 24-7 exposés pointed out in depth and detail how an international campaign against the Gadhi Mai sacrificial slaughter held every four years in rural Nepal was based on bogus statistical claims and falsified history, and was chiefly a fundraising ploy enlisting major animal advocacy organizations in an unholy partnership with the local priesthood where the slaughter took place.
Agreed Gil Michaels on October 3, 2014, “This is the biggest scam purported by the animal protection community ever. It makes us look like fools. Keep pushing against scams like this.”
Gil Michaels on pit bulls
Gil Michaels on October 16, 2014, commenting on a Branwyn Finch guest column entitled “Parallels between the messages sent by advocates for aggressive dogs, and the messages internalized by victims of domestic violence,” first expressed resolute support for our many exposés of pit bull advocacy, and the consequences thereof for both animals and humans.
“Hell yes!!!!!!!” Gil Michaels began. “I couldn’t agree more.”
Over the next several years Gil Michaels composed a lengthy screed against pit bull advocacy, one line at a time.
“I just love those sweet, cuddly, harmless pit bulls,” Michaels offered next, with deep sarcasm. “Everyone with infant children should have at least one. That way we can help solve the overpopulation problem. Pit bulls for all!!! A pit bull in every pot.
“Ban breeding pit bulls”
“I agree with you on this issue,” Gil Michaels continued. “Why not pass strict laws governing the ‘currently alive’ pit bulls and ban the breeding of ‘not yet alive’ pit bulls? That should satisfy everyone, assuming they have any sense. Pit bulls, Rottweilers and other obviously dangerous dogs have no more place in society than lions and tigers.
“Pit bulls should be phased out ASAP,” Michaels emphasized. “Most are weapons, not companion animals.
“Keep pushing this issue. The other side are irresponsible morons. How could it make any sense to anyone, other than a total moron, that to own or breed pit bulls should be allowed in a sane society??????
“Just stop breeding them and let the existing ones die off and be done with them and the carnage they cause. Why doesn’t that make sense??
“Don’t pay any attention to your detractors”
“You are absolutely right on this issue,” Gil Michaels repeated. “Don’t pay any attention to your detractors. In fact, you can use Animal Guardians ,” one of Gil Michaels’ two animal advocacy organizations, “as a supporter of your position. These promoters of pit bulls are mentally disturbed extremists of the ISIS mentality.
“All of these bully promoters should be incarcerated as terrorists for life,” Gil Michaels continued. “What idiots.
“At some point people will wake up,” Gil Michaels hoped. “I would be interested in providing some funds for a campaign to outlaw the breeding of pit bulls and all the other dangerous bully weapons out there. Pit bulls are weapons and, unlike M16s, could go off without warning or reason. Ban them and all other forms of assault weapons.”
Fought rabbit-eating & bullfights
Gil Michaels had many other ideas for campaigns that he hoped to fund, most of which failed to develop from lack of other dedicated activists to launch them.
For example, based on data showing that about seven times more Americans keep pet rabbits than eat rabbits, Gil Michaels believed rabbit-eating could be banned.
One of Michaels’ campaigns that did enjoy some success, until Spanish politics took a sharp turn to the right under adverse economic conditions, sought to ban bullfighting in Spain.
“Without any doubt,” Spanish anti-bullfighting campaigner Marta Esteban wrote to ANIMALS 24-7 in May 2016, “Gil Michaels’ financial support has been key in order to speed up the results not only in Spain but also in all bullfighting countries. Thanks to him,” Esteban said, “a strong team of activists from nine different countries work together now in real time in pursuit of our common goals and no one can stop us. Without Gil Michaels’ help, everything would have taken more time.”
Burned by PETA
But Gil Michaels was further disillusioned about working with major national and international organizations when a People for the Ethical Treatment of Animals fundraising appeal on May 31, 2018 bannered “40,000 Take Part in PETA-sponsored March Against Bullfighting in Madrid,
“Here they go again,” Gil Michaels emailed to ANIMALS 24-7, “misrepresenting themselves as always, making this seem like PETA was the be-all and do-all at this event when, in reality, they were just a chicken shit, cheap, and phony bit player, as usual.
“Animal Guardians provided $8,500 in U.S. dollars for this event, the rest of the world provided $6,500, and the PETA portion of that was $700 USD.
“For the last three and a half years,” Gil Michaels said, “Animal Guardians has invested vastly more funding to end bullfighting than the entire rest of the world.”
Gil Michaels’ world, career, and reputation in both business and animal advocacy unfortunately came crashing down with a June 28, 2016 media release from the Department of Justice, U.S. Attorney’s Office, Central District of California, headlined “23 People Indicted in Decades-Long, $126 Million Telemarketing Scheme involving Sale of Toner for Copiers and Printers.
“The indictment unsealed after this morning’s arrests,” the Department of Justice media release explained, “alleges that participants in the scheme fraudulently induced over 50,000 victims to send more than $126 million to telemarketers who posed as the victims’ regular supplier of toner products at prices as much as ten times the normal retail price.
“The 30-count indictment, which charges 23 defendants, alleges a conspiracy that started in 1988 and was orchestrated by Gilbert N. Michaels, a West Los Angeles man who had previously been ordered by federal and state court judges to cease fraudulent and deceptive business practices related to toner sales.”
How it worked
Detailed the media release, “Michaels owned and operated IDC Servco, a Culver City-based business that sold toner to small businesses, charities such as Easter Seals Disability Services and the United Way, schools, churches, city governments and other entities in the United States and Canada.
“The indictment outlines a scheme,” the Department of Justice said, “in which telemarketers at a series of companies called victim organizations and claimed to be their regular supplier of toner or affiliated with those suppliers. The telemarketers typically told employees at the victim companies that the price of toner had increased and they had not been notified. However, the victims now had a chance to purchase toner at the previous lower price. Believing that they were dealing with their regular supplier of toner supplies, employees at the victim companies signed order confirmation forms, which prompted Michael’s company to ship toner to victims and send invoices that demanded payment at inflated prices.”
“In a series of court orders dating back to November 1988,” the Department of Justice noted, “Michaels and his companies were prohibited from making false statements – such as that they were a usual supplier of photocopier supplies or that there had been a price change.”
None of the other 22 defendants appear to have been involved in animal advocacy.
“All 23 defendants are charged with conspiracy to commit mail fraud,” the Department of Justice said “Each of the 23 is charged in at least one of the two dozen mail fraud counts alleged in the indictment. Michaels is additionally charged with five counts of money laundering.”
Responded Gil Michaels, when asked by ANIMALS 24-7 for his side of the matter, “This is very old news. I’m NOT guilty of these outrageous allegations. End of story.
“This is no one’s business”
“This is no one’s business,” Michaels insisted. “People who know me don’t give a fuck about this. My work for animals all over the world has continued with no fanfare and will continue. Any so-called animal protection person that would bring any attention to this matter would be doing an unconscionable disservice to animals.
“This is an active case and I have been advised by my attorneys not to comment on the details. It’s bullshit and has nothing whatsoever to do with my 35 years and multi millions of dollars that I have devoted to the protection of animals worldwide,” except that the long-running toner scam was apparently the source of the money that Gil Michaels put into animal advocacy.
Gil Michaels from mid-2015 to the indictment was a major funder of ANIMALS 24-7, but made no further donations after ANIMALS 24-7 questioned him about the federal charges.
Convicted of multiple counts in 2021
Gil Michaels did, however, continue to send frequent supportive emails, especially when ANIMALS 24-7 received hostile responses to our coverage pertaining to pit bulls.
In view that Gil Michaels steadfastly denied guilt, ANIMALS 24-7 did not report about the charges against him while the federal charges remained before the courts and in the appeals process.
In September 2021, however, after a six-week trial, a federal jury found Gil Michaels guilty of one count of conspiracy to commit mail fraud, 10 counts of mail fraud, and five counts of money laundering.
Gil Michaels, reporting net worth of $6.7 million, was sentenced to pay a $200,000 fine and to report to federal prison by November 1, 2021 to serve a four-year sentence.