In Private Sector, Giuliani Parlayed Fame Into Wealth
Sunday, May 13, 2007
On Dec. 7, 2001, nearly three months after the terrorist attack that had made him a national hero and a little over three weeks before he would leave office, New York Mayor Rudolph W. Giuliani took the first official step toward making himself rich.
The letter he dispatched to the city Conflicts of Interest Board that day asked permission to begin forming a consulting firm with three members of his outgoing administration. The company, Giuliani said, would provide "management consulting service to governments and business" and would seek out partners for a "wide-range of possible business, management and financial services" projects.
Over the next five years, Giuliani Partners earned more than $100 million, according to a knowledgeable source, who spoke on the condition of anonymity because the firm's financial information is private. And that success helped transform the Republican considered the front-runner for his party's 2008 presidential nomination from a moderately well-off public servant into a globe-trotting consultant whose net worth is estimated to be in the tens of millions of dollars.
In crafting its image, the firm took care to burnish its most valuable asset: the worldwide reputation Giuliani had earned for his composure and leadership in the days after the terrorist attack on the World Trade Center. "No client is ever approved or worked on without a full discussion with Rudy," said the firm's senior managing partner, Michael D. Hess, former corporation counsel for the city of New York.
Not surprisingly, a firm that markets Giuliani and is run by Giuliani has taken on the characteristics of the politician, who even by New York standards was known for his self-confidence and sometimes defiant insistence on doing things his way.
Famously loyal, Giuliani chose as his partners longtime associates, including a former police commissioner later convicted of corruption, a former FBI executive who admitted taking artifacts from Ground Zero and a former Roman Catholic priest accused of covering up sexual abuse in the church.
Giuliani, grounded in the intricately connected world of New York politics, has been more than adept at making the system work for his clients. They have included a pharmaceutical company that, with Giuliani's help, resolved a lengthy Drug Enforcement Administration investigation with only a fine; a confessed drug smuggler who hired Giuliani to ensure his security company could do business with the federal government; and the horse racing industry, eager to recover public confidence after a betting scandal.
Clients of Giuliani Partners are required to sign confidentiality agreements, so they do not comment about the work they receive or how much they are paying for it. Though now running for president, Giuliani refuses to identify his clients, disclose his compensation or reveal any details about Giuliani Partners. He also declined to be interviewed about the firm.
Because of this secrecy -- a request to visit his wood-paneled offices overlooking Times Square was turned down -- a complete picture of the firm and its business is difficult to obtain. This report is based on a review of corporate, government and court records, along with scores of interviews with clients and government officials who have interacted with Giuliani Partners.
Hess, the one official authorized to speak for the firm, said Giuliani Partners does not want its clients to exploit Giuliani's name and does not engage in lobbying. He said the company carefully chooses whom it hires and represents.
"We're cautious in the right sense of that term, in terms of who we work for. We always want to make sure it is a company that is doing the right thing, that we're proud to represent," he said.
For many clients, hiring Giuliani delivered the political equivalent of a Good Housekeeping seal. Start-up companies or clients enmeshed in controversy gained instant credibility as well as the potential to access a vast Rolodex of contacts Giuliani and his partners have amassed over the years.