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Gene Freidman, the 'Taxi King' who inflated prices of taxi medallions, dies at 50

AILSA CHANG, HOST:

New York City taxi drivers have been protesting for weeks, asking the city to help them reduce the massive debts that they incurred purchasing the medallions that make it possible for them to work. And on Sunday, one of the men responsible for inflating the cost of those medallions died.

SARAH MCCAMMON, HOST:

Evgeny “Gene” Freidman was known as the Taxi King. He got in the business through his dad, who drove cabs after the family emigrated to New York from Russia in the 1970s. His father owned eight taxi medallions, but Gene Freidman saw an opportunity to grow the family business using big interest-only loans with low rates to buy as many medallions as possible. He offered to buy his dad out as he shared in a speech at his alma mater, Yeshiva University.

(SOUNDBITE OF ARCHIVED RECORDING)

GENE FREIDMAN: He said, why do you need this? He goes, it's a dirty, dirty business. You could get so many (unintelligible). He goes, why do you need it? I said, because I think I got something here. And I started running the business.

CHANG: Freidman bought up as many medallions as he could. He also began to overpay for them, driving up their price and making it harder for others to buy them.

(SOUNDBITE OF ARCHIVED RECORDING)

FREIDMAN: So I'd go to auctions. I'd bid crazy prices. People were looking at me like crazy. I don't really care.

CHANG: Eventually, he amassed about 900 medallions and operated the largest fleet in New York City.

MCCAMMON: But as he got richer, he stopped paying his debts. And there was the emergence of Uber and Lyft to contend with. Freidman told Bloomberg Business he wasn't concerned.

(SOUNDBITE OF ARCHIVED RECORDING)

FREIDMAN: (Unintelligible) that in my business, times are either awesome, excellent or just very good. So I think we're on the bottom of very good right now.

CHANG: But the bubble burst. The price of medallions plummeted, and banks wanted repayment on loans from him and from thousands of drivers who were neck deep in debt.

MCCAMMON: Freidman faced a series of lawsuits, but he avoided jail time by cooperating with an investigation into one of his longtime business partners.

(SOUNDBITE OF ARCHIVED RECORDING)

UNIDENTIFIED JOURNALIST: And his personal lawyer, Michael Cohen, after one of Cohen's major business partners, Evgeny Freidman, known as the Taxi King, cut a deal with prosecutors.

CHANG: Gene Freidman was 50 when he died and still a wealthy man, but the thousands of drivers who purchased medallions at prices that Freidman helped inflate are still in crushing debt and facing financial ruin. Transcript provided by NPR, Copyright NPR.