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Perelman/AP File
Revlon executive Ronald O. Perelman poses with three of Revlon's spokewomen in 1997. Left to right: Cindy Crawford, Salma Hayek and Halle Berry. (Reuters)

Perelman Power

By Michael Powell
Washington Post Staff Writer
Friday, February 6, 1998; Page B01

Ronald O. Perelman, the richest man in New York City -- and therefore one of the richest men on Earth -- doesn't ask a lot of questions when the Washington money guys call. Republican, Democrat, their pitches sound alike: Won't Perelman contribute to the Republican National Committee, the Democratic National Committee, President Clinton, Bob Dole, George Pataki, Mario Cuomo, Pete Wilson, Arlen Specter, Pat Moynihan . . . ?

It's a blur and, frankly, a bit of a bore for him, say his friends. But this is business.

So the billionaire writes checks, a hundred thousand dollars to Democrats here, a hundred thousand to Republicans there. He chairs presidential fund-raisers and hires -- "acquires" is the verb of choice -- some former politicians and their friends.

But back in his Upper East Side Georgian town house, away from the political stiffs, Perelman, 55, prefers to talk about the important stuff with his fellow plutocrats.

Business and babes.

"We spend 95 percent of our time talking women and 5 percent talking deals," Donald Trump noted of Perelman in his recent book, "The Art of the Comeback." To which an occasional Perelman adviser adds: "His basic value is making money, money, money and collecting women."

Perhaps. But this bald, 5-foot-7, cigar-smoking walking conglomerate from New York, who apparently cares barely a whit for ideology, has become a player in a distinctly Washington crisis. In two instances recently, Perelman, who runs Revlon and a couple of dozen other companies, has offered employment to acquaintances of the president.

Twice in the last two months, Vernon E. Jordan Jr., a close friend of Clinton's and longtime Revlon board member, telephoned Perelman directly to cadge a $40,000-a-year job for Monica Lewinsky, the former White House intern. One of those calls, sources say, came 24 hours after Lewinsky swore out an affidavit in which she denied having sex with the president. (Jordan's wife, Ann, is a board member at another Perelman company.)

Lewinsky's Revlon career didn't last long. The day that word of the job offer became public, Revlon dropped her.

Clinton friend Webster Hubbell lasted a bit longer. In April 1994, Perelman's parent company, MacAndrews & Forbes Holdings Inc., signed a $100,000 consulting contract with Hubbell, just weeks after he had been indicted and resigned from the Justice Department. When word of that "public relations" contract became known last summer, a spokesman for Perelman declined to say who arranged for Hubbell's hiring or what Hubbell did for his money.

Perelman terminated Hubbell's contract in December 1994, when the former associate attorney general pleaded guilty to making false statements in a federal probe. He served 18 months in prison.

All of this has brought Perelman some unwanted attention from independent counsel Kenneth Starr's office. No subpoenas have been served on Perelman, however, according to associates. And few expect the experience to scare him off politics.

"He's the wealthiest man in the world. To him, Starr is just a pisher," Yiddish for "little nothing," said a man who has worked for Perelman occasionally. "Hiring Hubbell, talking with Jordan, it's just insurance, that's all."

The notoriously press-shy Perelman did not consent to an interview for this article. His aides sent along a copy of a Business Week story, and suggested that might suffice as the official text.

Business and Politics

The Republican fund-raiser remembers talking with Perelman at a party. The billionaire stood there, foot-long cigar in mouth, attended by his usual retainers, his bodyguards and the aide who carries his cell phone. He had just given $20,000, maybe $30,000 to the Republican Governors Association.

But he wasn't much interested in talking about it.

"He's a centrist and my conversation with him was pretty quick and superficial," said Wayne Berman, finance chairman for the group. "But I should point out that he's very generously superficial."

Here in Washington, politics and influence are all. The buzz is about angles and spin, calculations of favors given and received, who's in and who's out. The assumption is that Perelman, like most everyone here, wants to be a player, that he gets a frisson from his proximity to political power.

But in New York City, in the pre-nup, post-nup, nip-and-tuck world of the rich -- make that the very rich -- friends describe Perelman as an instinctive, brilliant businessman with a volcanic temper, and a serial husband who gave one wife an $80 million alimony settlement and patted down the next wife when he suspected she was taping their conversations (she was). He loves his companies and his takeovers, his cigars and his daily fish lunches at Manhattan's swank Le Cirque 2000 (his "cafeteria," he calls it).

But no one says he loves politics. That's a Washington game and they can keep their frisson. When your net worth is about $5 billion -- give or take a few hundred million -- it's simply smart business to do a few political favors and acquire a few liabilities for a troubled president.

Perelman has long given money across the political spectrum. But it was a soon-to-be former wife, Patricia Duff, who pulled him firmly inside Democratic money circles.

The potentate sat across from Clinton at a $1,000-a-plate dinner at the Sheraton Hotel in New York City in 1995. Duff sat to Clinton's left. And months later, he attended a state dinner for Brazil's president at the White House. He personally signed on as a member of Clinton's $100,000 club -- his companies and executives contributed at least $670,000 to the Democratic National Committee in 1995 and 1996.

Still, Perelman never became a partisan. He just kept writing checks for one and all. He attended the Republicans' triumphant fund-raiser after the party took control of Congress in the 1994 election. He sent New Jersey Democratic congressman Robert Torricelli a $1,000 check for his 1996 Senate campaign, and a week later sent another $1,000 check along to his opponent. And last year Perelman and MacAndrews & Forbes contributed $416,000 in soft money to the Republican National Committee.

"For Duff, it was about politics and getting people elected," said a prominent Democratic fund-raiser. "But for Perelman, it was just the bar mitzvah circuit. You give because that's what you do when you're a billionaire."

Indeed, in his above-the-rim financial world, politicians -- even the president -- are ornaments. And Perelman collected many such baubles in New York before turning his eye toward Washington.

Perelman's company, records show, gave $7,700 -- the maximum allowable donation -- to Rudolph Giuliani's 1993 New York mayoral race and, according to the Village Voice, pumped $75,000 more into a third party that vigorously supported Giuliani. But when Giuliani won, Perelman roped in the Democratic castoffs: He hired the man Giuliani ousted, David Dinkins, as a Revlon consultant and retained former city council president Andrew Stein, who almost challenged Dinkins in the Democratic primary. He also hired former deputy mayor Bill Lynch, a prominent member of the Democratic National Committee and a friend of Jesse Jackson.

Lynch and Dinkins were seen as useful accouterments, most especially as Revlon eyes the newly emerging market of South Africa.

"Perelman ran a job bank for unemployed Democrats," said Mitchell Moss, director of New York University's Urban Research Center. "He's not a political guy; he's just sitting on a corner where commerce and politics intersect."

None of these men got on the telephone for this article. All of Perelman's top employees must sign a confidentiality agreement as a condition of employment. And the billionaire is obsessed enough with his security to have hired a former FBI director and the former No. 2 cop in New York. In addition, he tapes every phone conversation.

Curiously, Perelman has rarely wielded his political influence in New York.

"He called exactly once, and that was about zoning for his town house," recalled Richard Schrader, the city's former consumer affairs commissioner. "You got the sense that he saw people in government as essentially incompetent. If we had juice, in his mind, we'd be out making deals."

Perelman's footsteps are not much easier to discern in Washington.

He cut a spectacularly lucrative deal to take a chain of ailing savings and loans off the federal government's hands in the late 1980s. And industry analysts say he's masterly at consolidating his tax liabilities in several holding companies, saving himself tens of millions of dollars each year.

But there's no tax loophole with his name on it, no obvious trade concession that his lobbyists can claim as their own.

One prominent Democratic giver, himself a Wall Street Croesus, described Perelman's place in the political fund-raising firmament. "On Wall Street, there are three groups with politics: Most don't care and don't give. Some, like me and [Treasury Secretary Robert] Rubin, Wilbur [Ross of Rothschild Inc.] and Felix [Rohatyn, the financier who is now U.S. ambassador to France], care about politics and give a lot.

"Then there's a very small third group that doesn't give a [expletive] about politics, but gives a lot because it might prove someday useful. That's Ron's group."

Wall Street Warrior

Believing Mr. Perelman has no hostile intentions is like believing the tooth fairy exists. -- John Gutfreund, former CEO

of Salomon Brothers, in 1988

Perelman was one of the original barbarians at the gate, a young man from Philadelphia armed with a quiver full of Drexel Burnham junk bonds who invaded Wall Street in the early 1980s and transformed the place.

His father, Raymond, had acquired no small reputation as a tough businessman and corporate raider in Philadelphia, and he had tutored his pre-adolescent son in deconstructing balance sheets and the cut-and-slash of business. But when Ronald asked his 61-year-old father if he planned to retire from the family business in 1978, his father said no. So Ronald departed for New York, along with his wife, who had a $100 million dowry from her wealthy Philadelphia real estate family.

"Raymond and Ronald are very, very competitive with each other," said a longtime family friend. "There's no slack cut."

Methodically, Perelman sought out top young talent in New York, developed a pack of hungry men and became pals with Michael Milken, whose name would eventually become synonymous with "corporate raider." Together they surveyed Wall Street like two young raptors.

First they secured Perelman's own company, MacAndrews & Forbes, using a controversial stock buyout to take the company private. In 1985, they assaulted Revlon, the very bastion of old-money Wall Street. Ever the anti-classicists, the raiders code-named their attack plan "Yertle the Turtle" and spoke with disdain of Revlon's chief, Michel Bergerac, whose comforts included a company 747 equipped with gun racks for his safaris.

There was savage parry and thrust, and eventually Perelman claimed Bergerac's head and victory.

The next year, Perelman attacked Gillette; he was less successful but the company essentially gave him $34 million to go away. The year after that, he lunged at Salomon Brothers, a bloodletting that led to enormous losses and 680 layoffs.

So it went, one nasty battle after another. And Perelman was cast as the parvenu spitting in the face of a more genteel crowd. The board of a Fifth Avenue co-op rejected the budding billionaire ("A process that was devastating to my ego," he once told New York Magazine). When Milken was arrested and Drexel Burnham Lambert collapsed, older heads broke into telling smiles.

Of course, such high moral dudgeon has a certain comic cast. The history of Wall Street is ever one in which the so-called Old Money, whose forebears consolidated their empires with much bloody excess, expresses mortification (Shocked! Absolutely shocked!) at the boorishness of the new arrivals.

In fact, Perelman began to settle down a bit after he assembled his pile of rocks. The barbarian is now intent on becoming a Roman.

He insists today that he loves to run companies and is no longer interested in simply stripping their assets as in the randy days of old. He's acquired fine art -- a Matisse and Warhol adorn his walls -- he is a trustee at the Kennedy Center and he ranks as one of the nation's leading philanthropists, donating $20 million to build a new student center at the University of Pennsylvania, his alma mater.

Still, his newfound gentility is a bit of an ill-fitting suit. Perelman evinces no desire to assume Rohatyn's crown as the philosopher king of Wall Street (although he now counts Rohatyn, who once denounced Perelman as the very embodiment of the arriviste, among his informal advisers).

For his friends, Perelman's throw pillows rather than his art speak more directly to his soul. One in his town house is embroidered: "No guts, no glory." Another: "Happiness is a positive cash flow."

"Does he really appreciate art? No. Does he read novels? No," said a person who works for Perelman. "He's a hard-core businessman with brass balls. But he's trying."

His religious convictions are no less intriguing. He's a member of the old money Orthodox Jewish Fifth Avenue Synagogue, keeps a kosher home and prays three hours every Sabbath.

But he is deeply involved in the assertive, Hasidic Lubavitcher sect, a group rooted in 18th-century Judaism and now centered in Crown Heights, Brooklyn. At the moment, Perelman is underwriting the construction in that neighborhood of the largest Jewish girls' school in the world.

Lubavitcher rebbe Abraham Shemtov has communed with Perelman in matters of faith for 30 years. Shemtov often travels to the financier's decidedly secular digs on East 63rd Street, where the billionaire passes most of his time with business associates amid clouds of cigar smoke and jocular boys' talk of takeovers, tax shelters and women.

That stops when Shemtov enters the room.

"We talk more than once a week," Shemtov said. "We discuss lessons from the Bible. It's a central dimension of his life."

Wives' Tales

The story is part of the Perelman legend, no less true for being so completely over the top.

Perelman's son Josh was getting married a couple of years back. Ronald instructed him to make sure that his fiancee signed a pre-nuptial agreement. Josh protested: This is a matter of the heart, Pop.

So Perelman called his friends and told them he wasn't going to attend his son's wedding. And he didn't.

The competitive fire that fueled his junk-bonded hostile takeover has rendered Perelman's private life a bit, well, tumultuous. His marriages, especially, are a billionaire's blood sport.

His first such merger ended in 1983, when his wife, Faith Golding, sicced a private detective on him. Perelman called in Roy Cohn, piranha attorney extraordinaire, and gave Golding $8 million and a divorce.

His second marriage, to gossip columnist Claudia Cohen, had a more expensive denouement. He kicked it off in 1985 in Masters of the Universe style, hosting a 450-person party at the Palladium with music by the Pointer Sisters.

Alas, the fun didn't last. In 1994, they divorced amid nasty, distasteful and rather juicy charge and countercharge. But inflation took its toll on Perelman's alimony settlement: Cohen walked away with $80 million.

No matter.

Within months, Perelman was back in the market. In 1994 he married Patricia Duff, herself freshly divorced from movie mogul Michael Medavoy, shortly after she gave birth to their daughter.

Duff had spent her formative years working for Democratic pollster Pat Caddell and worked for the House panel that looked into the assassinations of John F. Kennedy and Martin Luther King Jr. She later introduced Clinton to the Hollywood establishment, amid perhaps inevitable rumors of a romantic liaison with the Arkansan.

Duff spent much of the first two years of their marriage establishing herself as a premier Democratic fund-raiser. She jetted about the country, giving speeches and trading a bit on her husband's name.

In August of 1996, the peripatetic couple rested. They took a 10-day vacation on a yacht off the coast of Italy. Their support staff followed behind them on its own boat.

Duff returned to work the floors and party suites at the Democratic National Convention in Chicago. Perelman was not amused, say friends. He didn't like her partying on her own, and he didn't like her disobeying him.

When he arrived in Chicago and found that she had paid him no heed, his pique overflowed. He ordered her from his limousine.

After that, everything was endgame. She went to their palatial mansion in East Hampton, N.Y., allegedly to talk reconciliation. But neither one seemed overcome by trust. Perelman immediately patted her down. And he found she was wearing a miniature tape recorder.

Husband and wife have now acquired divorce lawyers. Perelman has found some consolation, say friends, in the knowledge that he forced Duff to sign a "truly terrible pre-nuptial agreement." And he has passed his time dating a series of 20- and 30-somethings, among them Eleanor Mondale, the statuesque daughter of the former vice president.

Secret Society

No one expects Perelman's divestment of Duff to signal his withdrawal from politics. They note that Duff was long gone when Perelman took Jordan's phone call last month.

"It's like the Mafia, it's all done in code," said someone who has worked with Perelman and both respects and fears the man. "I can assure you that Ronald made the decision to give Lewinsky a job. And I can assure you he wouldn't want to know why Jordan was asking."


© Copyright 1998 The Washington Post Company

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