Elliott Broidy wiped me from the list of people he is prepared to talk to on September 9, 2007. It was an embarrassing occasion. He phoned on the evening of that day following a request for a response to an investigative piece in the “New York Daily News” that, for the first time, exposed his links to the corruption affair at the New York State pension fund that would eventually lead to his downfall. But then, when the storm clouds were far off and Broidy was a respected member of the Israeli business aristocracy, he sounded hurt, embittered, angry, and above all shocked, a passer-by severely injured by a journalistic roadside bomb. Him? How could a reporter think of connecting his name to an affair like this? His tone was one of disgust and disdain, like someone who had trodden on dog shit on the pavement and was ready to behead the owner of the offending animal.
It’s in the Daily News, I said to him, and you’re not the only one there. Companies like Carlyle and the Third Point Capital hedge fund are also mentioned, and a few months ago “The New York Times” wrote that the New York State Prosecutor was investigating whether the New York State pension fund had handed over chunks of its capital to financial firms on the basis of professional considerations alone, or whether some of the companies found their way to the fund’s money in illicit ways. Garbage, it’s all garbage, Broidy fulminated. All the business newspapers in Israel are garbage too. “Globes” is garbage. All that interests you is gossip. He was however prepared to release for publication an official statement on behalf of Markstone, on condition that I would not reproduce the reports in the US press. The statement, it turned out, was a whitewash. It failed to mention most of the matters in the Daily News article, matters that two years later would seal his fate. I told Broidy that I would be happy to publish it alongside the information gleaned from the New York newspapers.
Broidy switched to pleas, as though his life depended on it. For an hour and a half, he wasn’t the Los Angeles mogul, but a frightened man in front of whom a chasm yawned. He claimed that Globes was doing him a terrible injustice, asked me to have consideration for him, and hinted that it would be worth my while toeing his line. He would open doors for me. I replied that in any case, everything had come out, that the horse had bolted, and what importance did a report in a small newspaper like Globes have if a major metropolitan New York daily had published the same information for all to see? Apart from that, Globes already knows, and is waiting for a report. You don’t understand, he said, and that was the end of our working relationship, the peak of which was an exclusive interview with him in Globes two years previously, in which he presented himself to the Israeli public.
”You really didn’t understand, and I think you still don’t,” someone who knows Broidy well told me this week. “In many ways, he cares more about what they think of him in Tel Aviv, Jerusalem, and Herzliya Pituah, than about what they think of him in America. He’s like family among the rich and powerful here. Israel is his desire, his life’s joy. It’s true that in the electronic age, it makes no difference what is published where. Any analyst in Tel Aviv could reach the Daily News report with a few mouse clicks. But as soon as an Israel newspaper publishes something negative about Broidy, it’s as though the dirt has been brought into the house. What happened in that world, in New York, he didn’t want to bring into his world in Israel. It may be irrational naïveté, but that’s Broidy.”
The warm corner reserved for Israel in 52-year old Broidy’s heart could be the key to his behavior in the New York State pension fund affair, along with the scale on which he operates. His aspirations are as big as he is. He is someone who has always thought big, those who know him testify, and he perhaps continues to think that way.
A source who describes his relationship with Broidy as “very close” says the man wanted to do great things. Small things don’t interest him, don’t appear on his radar. Everyone would have taken their hats off if Markstone had made do with raising, say, $200 million or $300 million. But no, Broidy wanted to break a record, to do something that would leave a strong impression. Therefore, perhaps, he found it hard to close the window of opportunity that the New York State pension fund opened before him, a window through which another $200 million beckoned that could make Markstone’s crown yet more glittering (according to the New York State attorney general it was $250 million).
”It just wasn’t like Elliott to do a thing like that, to pay a bribe like some criminal,” the source says. “But the feeling that he was acting for Israel’s sake apparently overcame him. He loved relating that Arik Sharon approached him and asked him to do something for Israel. Elliott took that very seriously; in retrospect, a little too seriously.
”As I see it,” Broidy’s associate added “the urge to benefit Israel, to push its economy forward, was as strong with Elliott as his constant wish to win recognition and prestige. At the same time, I’m not sure he fully realized that he was committing a crime. It’s true that he admitted giving a bribe, and I can only imagine what pressure the prosecutor brought to bear on him, but it seems that, in himself, he thought that that was how business had to be got moving.”
”Of course,” the associate hastened to add, “I’m far from justifying what he did. He hurt himself, he hurt Markstone, and he flouted the law.” Nevertheless, it seems to me that if that associate were a member of a New York jury, he would vote against convicting Broidy, even though Broidy admitted bribing pension fund officials to the tune of $1 million to persuade them to do business with Markstone.
If Broidy’s fall is making waves in Israel, it has roused a tsunami in his other worlds: the Republican Party, to which he is a major contributor, and the US Jewish community. But the interesting thing is that, in both these universes, hardly any condemnations have been heard, perhaps because in neither do people want to bite the hand that has fed them. As Rob Eshman wrote in the Los Angeles Jewish Journal, “There has been not a whisper of public rebuke in the Jewish communal world, a world to which Broidy’s name has been quite publicly linked.”
Even so, there are signs of public dissociation from Broidy, or at least from his money. Candidates for state governor, attorney general, insurance commissioner, and other posts in California are declaring that contributions from Broidy will be donated to charity because the money is tainted.
For Broidy, who has devoted his life to the image of the grandee, the super-philanthropist, and the kingmaker behind the scenes, through his checks, that must be a particularly stinging insult, and we haven’t yet mentioned the four-year jail sentence, the maximum penalty hanging over his head, which will make him sing like a canary. But that humiliation is another story.
Published by Globes [online], Israel business news - www.globes-online.com - on December 10, 2009
© Copyright of Globes Publisher Itonut (1983) Ltd. 2009