Marriage is love.

Thursday, March 31, 2005

Rudy Giuliani - From Hero to Bum

"Mr. Big Apple Goes Rotten

New exposes have shed light on one of the great overlooked stories of recent months: the steady political devolution of former New York City Mayor Rudy Giuliani – from Man of the Year to brazen profiteer. Giuliani is poised to join forces with a Houston law firm which has close ties to oil and gas companies, such as the Bechtel Corporation, which has used its high-powered connections to swing lucrative contracts in Iraq. (Enron used to be one of the firm's major clients, but ties were cut after the bankruptcy scandal in 2001.) An investigation published earlier this month by USA Today details how Giuliani, who made his reputation in the 1980s as a tough prosecutor of white-collar criminals, is now himself knee-deep in a scandalous business deal that smells worse than the Hudson. Even more alarming is yesterday's profile in the New York Observer, describing Giuliani's willingness to put profit over principle as so extreme that he actually used tsunami benefit events to line his pockets with tens of thousands of dollars.

PROFITING FROM DISASTER: Just last month, a South Carolina Hospitals Association event that Giuliani agreed to keynote was scrapped and replaced with a fundraiser for tsunami victims in South Asia. Giuliani decided to attend anyway, explaining that it was "a worthy cause." How worthy, exactly? Clearly not enough for Rudy to forego his five-figure speaking fee (he does, after all, have to keep up payments on both his $5.25 million East Side co-op apartment and his $3.9 million Bridgehampton mansion). Giuliani charged the organization $80,000 for his appearance – so much that the association's spokeswoman admitted "she was not even sure whether the benefit's total take had exceeded Mr. Giuliani's fee." And this wasn't an isolated case. At "a fund-raiser for the Red Cross in Vancouver, Mr. Giuliani's fee seems to have roughly equaled the event's receipts, which were announced to be $100,000 – the same amount as he was paid to help raise the money."

CRYING OVER KERIK: Giuliani is still marred by his decision to 'cash in his chips' with the Bush administration and lobby for a cabinet position for his close friend and business partner Bernard Kerik. Don't remember Bernie Kerik? He was President Bush's first choice for homeland security secretary, whose nomination crashed and burned after it was revealed (among other scandals) that Kerik had long-standing ties to a firm allegedly run by the New Jersey mob and had used an apartment donated for weary Ground Zero police and rescue workers as a personal love nest for his adulterous affairs. Despite those revelations, Giuliani couldn't bear to hear that Kerik was planning to resign from their joint firm, according to Tuesday's New York Times. "I went into his office and offered to leave, and he kept telling me no," Kerik said. "It was very emotional. We cried together."

NO CASH, NO CUSTOMERS, NO PROFITS, NO PROBLEM! Giuliani Partners, the ex-mayor's security consulting firm, recently signed a multimillion-dollar deal with a firm called Applied DNA Sciences, which develops DNA-marking technology used to thwart counterfeiting of goods like clothes and credit cards. Sounds reasonable enough, until you read the fine print: shortly before Giuliani Partners signed on, Applied DNA had "no cash for operations and no customers," zero revenue and had suffered "$35 million in losses from 2002 through 2004," according to SEC documents. Moreover, several of Applied's investors had been mired in scandals; the firm's co-founder, for instance, was charged "in a 1996 case involving a nationwide kickback scheme of stockbrokers and stock promoters." Despite all that, shares for Applied DNA "jumped an astonishing 268 percent … after the company disclosed its deal with Giuliani's firm." As former federal prosecutor Stephen Meagher noted, the deal "has all the markings of something Giuliani himself would have looked into as U.S. attorney in the old days."

TIP OF THE ICEBERG: Michael Hess, the senior managing director of Giuliani Partners, swears that his firm "would not rep some kind of shyster place or a company that is doing the wrong thing or fooling the public." Which is tough to believe considering the firm's "client list often reads like the list of witnesses before Congressional committees in some of the highest-profile corporate crises of the last few years." Of course, Hess also claims that Giuliani Partners works "to make sure that projects we represent are good for the people and good for the economy." You mean, like the "study suggesting that imported prescription drugs may be dangerous" that "Mr. Giuliani produced" for a pharmaceutical industry trade group he represents? (Even the Bush administration acknowledges that commercial imports from Canada are safe.)"