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Rock Music's Great Con Man: Allen Klein
During the 1960's, Allen Klein's name rambled through many rock bands. He was well known for his money handling of the riches brought to the musicians. He managed Sam Cooke, Bobby Vinton, the Dave Clark Five (the "other" Beatles in popularity), Donovan, the Kinks (the original heavy rockers with "You Really Got Me" and others), and of course, the Rolling Stones, with made him a very rich man. But, the group Allen really wanted under his belt was the Beatles. It was not until 1969, did Allen get his wish. That was the year of Abbey Road LP, some say one of the best Beatle albums and it was not until after the LP was out and the Beatles had broken up did John Lennon bring in Allen. It was a year before, 1968, the Beatles ventured out into disaster with their Apple Corporation. What was suppose to be a creative heaven ended up in a financial cesspool that nearly broke the Beatles broke. Apple records was kept alive by those who created it and a hit by Mary Hopkins ("Those Were the Days"), Badfinger, James Taylor (his first LP). But, the accounting methods used to track how much was spent and earned was a mess. And then there was the whole Get Back recordings done in 1968 that Lennon called, " a bunch of trash". Granted, McCartney's idea of Get Back was to go back like it was in 1964 and document how the Beatles made music in the studio. What it ended up being was a documentary of the Beatles growing apart and breaking up. It was filmed and ended up be released on DVD as "Let It Be". It is sad to watch if you are a fan. However, some of the songs were decent enough, so Lennon brought in Allen Klein to resurrect the can of mess created by discontent. The other Beatles opposed, especially Paul, who called him a "trained New York crook". He was not far off with his creative accounting methods. At the time, Lennon argued that if Klein was not their manager for the Get Back material, they all would be broke in six months because Apple had lost so much money on failed ventures and bad decisions. The Beatles were great musicians, but lousy businessmen. Klein was the poison between Lennon and McCartney that became a cancer between rock's greatest songwriters.
Klein came from the same rough, loveless, childhood that Lennon had. He was tough and that appealed to Lennon who was sick of being ripped off by "leeches" as he would say. With Klein, his draconian harsh brash methods of contract negotiation, bill collecting, had halted the bleeding from Apple. All this would yield the Beatles a needed infusion of badly needed money by 1970. Lennon was ecstatic, saying, it was Klein that made this happen and he finally had much more money in the bank. While true, later it was found out that Klein, himself, had made out like a bandit on the deals he negotiated and they Beatles was unaware about. The percentage he took would be considered very excessive, but as along as the band is happy with the amounts they get, who cares? Klein would usually manage and sign an artist at the same time, a clear conflict of interest. He would own the rights to the songs. With the Rolling Stones, he (dba Abkco) managed them and owned the rights to their songs. Once the Stones started to pay attention to this, the band fought Klein for 10 years in courts to win their songs back. Klein continued to get royalties from the songs as he was the owner. When ABKCO took over Get Back, it was his company that got the rights to make the LP's in the USA and when McCartney releases his first solo LP in 1970, he was shocked to see his Apple Record an ABKCO company. That is when McCartney sued Klein, Harrison, Starr, and Lennon. Litigation went on for years and by 1973, even the other Beatles refused to renew contracts with Klein for the millions he had taken from them.
By 1974, even Lennon turned against him and admitted that maybe McCartney was right all along! Litigation would finally end in the late 70's with conspiracy charges. Klein was found guilty with a misdemeanor. He went to jail for two months. After the 70's, Klein continued to make money from previous deals and he still owned many popular songs being played.
But Klein was smart. At his peak, rock band earnings were often taxed at 90% under the 1960's U.K. taxes, to avoid this, Klein would simply put all of the band's assets under his name or ABKCO to avoid this. In fact, Lennon admitted that the main reason the Beatles had created Apple Corporation was to protect the income the band had made from such high tax rates. Apple was not entirely just a creative venture.
Today, rock band's are much more savvy about their contracts, royalties and their manager's percentage take. Allen died in 2009 from Alzheimer's at age 78.