Dennis Alter and the Tragedy of Advanta

SEVERAL YEARS AGO, when tycoon Dennis Alter threw himself a birthday party and decided to fly in Elton John to serenade his guests, the extravagance met a collective shrug. Alter hinted in public that he paid John handsomely, and the singer’s typical rate came to about $2 million. But the spectacle only appeared as a secondary item in Michael Klein’s Inquirer gossip column, which offered a languid dismissal: “No real surprise.”

A new Gilded Age, it seems, had taken hold of Philadelphia at the turn of this century, so golden and glittering that the city bore a marked resemblance to itself at the start of the previous century. The opulent class had grown bored.

Then, as now, certain Philadelphians and their wives tittered over scandals surrounding Thomas Eakins’s paintings. They traded and gossiped across new technologies — the telegraph, the Internet — and dazzled each other with the latest telephones. A few entrepreneurs and financiers seized the looseness of the moment, amassing fortunes faster than public overseers could count their profits. And an angry, emerging movement — calling itself Progressivism, then and now — aimed to pry that cash away from the new elite class. So the robber barons of each era, contemplating their treasures, struggled with only one question: how best to commemorate themselves.

Vast riches required careful distribution lest they be squandered unnoticed, so the monuments of choice were architecture and philanthropy. Moguls named buildings after themselves, added wings to universities and museums, and built mansions beyond the edges of the city. Searching for a symbol of the first Age, you might have headed into the suburbs to find legendary financier Jay Cooke overseeing construction of his multimillion-dollar demi-castle in Elkins Park — the mansion that would for some time be called his greatest folly. “The house, a little out of the city, was one of those elegant country residences which so much charm visitors to the suburbs of Philadelphia,” Mark Twain wrote of a fictional example in The Gilded Age. “A modern dwelling and luxurious in everything that wealth could suggest for comfort.”

And in the new Age, you might have found that other financier, Dennis Alter, just a short distance away — by space, if not time — overseeing the construction of his own vast palace. Alter runs Advanta, once one of the largest companies in Philadelphia, managing billions of dollars in assets. As recently as 2007, Advanta’s stock traded at more than $30 per share, while the company employed thousands of workers.

Today, though, the company lies in ruination after imploding in spectacular fashion. The current financial climate has forced many companies, local and otherwise, to contract and conserve. But Advanta’s staff has evaporated, and its stock value is now measured in pennies. So the question arises: What on earth happened at Advanta?