Posted on 07/29/2009 1:40:31 PM PDT by FromLori
The Pension Benefit Guaranty Corporation recently revoked contracts with BlackRock, Goldman Sachs and JPMorgan Chase based on questions surrounding how the formal bidding process was run.
How bad did Wall Street insiders suck up to Charles Millard after he arrived in Washington in May 2007, to run PBGC, the federal agency that oversees $50 billion in retirement funds?
One Blackrock insider even gave him postive reviews on his church attendance. David Mullane wrote in an emal to him: Great job at Mass again this week. Here's NYT with more gory details:
BlackRock, one of the world’s largest money-management firms, assigned a high school classmate of Mr. Millard’s to stay in close contact with him, and it made sure to place him next to its legendary founder, Laurence D. Fink, at a charity dinner at Chelsea Piers. A top executive at Goldman Sachs frequently called and sent e-mail messages, inviting Mr. Millard out to the Mandarin Oriental and the Ritz-Carlton in Washington, even helping him hunt for his next Wall Street job.
Both firms were hoping to win contracts to manage a chunk of that $50 billion. The extensive wooing paid off when a selection committee of three, including Mr. Millard, picked BlackRock and Goldman from among 16 bidders to manage nearly $1.6 billion and to advise the agency, which Mr. Millard ran until January...
An examination of thousands of pages of e-mail messages and other internal documents obtained by The New York Times shows the other side of the story: the two firms aggressively courted Mr. Millard, so extensively that they may have compromised federal contracting rules or at least violated the spirit of the law, contracting experts said. The records also illustrate the clash between Washington’s by-the-letter rules on contracting and the culture of Wall Street, where deals are often struck over expensive meals...
“This is a very big fish on the line,” one BlackRock executive wrote to another, discussing the government official.
Mr. Millard had at least seven meetings with Goldman executives in the year before the bidding started, and 163 phone contacts, the documents show. BlackRock had less frequent contact — 39 phone calls in that 12-month period. But one BlackRock executive told another that Mr. Millard had assured him in April, four months before the bidding, that he wanted to hire the company to help manage some of the money, company documents show.
“It sounds like we may have a tiger by the tail here,” one BlackRock executive wrote in an e-mail message...
Mr. Millard consulted with other industry experts during this period, but none so much as Goldman. George Koklanaris, Mr. Millard’s chief of staff, said in retrospect that the detailed analytical work Goldman did for Mr. Millard, and the repeated contacts, might have created an appearance that Goldman had a competitive advantage. Even so, he says he believes Mr. Millard did nothing improper...
In his conversations and e-mail messages with the agency head, Mr. Mullane often mixed family and business...
“Hope to see you at the Beefsteak Dinner tomorrow,” he wrote to Mr. Millard, referring to a Friday night gathering at Church of the Resurrection in Rye. “If you’re going perhaps we can catch up business for a few minutes before I thrash you in ping pong again.”
After a February meeting, months before the contract competition began, Mr. Mullane wrote his bosses: “Money in motion by February.” ..
As he prepared to open the competition, Mr. Millard, working with Mr. Mullane, sought to restrict the bidders to the biggest players by stipulating that the winner must have thousands of employees and a global operation, e-mail messages show. That decision cut out many boutique firms hoping to compete and gave BlackRock, Goldman and other large firms an advantage...
While the competition was getting started, Mr. Millard began his job hunt.
He started by contacting Mr. Weinberg of Goldman Sachs, sending him his résumé after meeting with him in New York last June.
Mr. Millard’s e-mail messages show that, while the bidding was under way last fall, he also spoke with Rick Lazio, a former House Republican who is now a senior executive at JPMorgan Chase, to discuss career options [JPMorgan Chase also had its contracts cancelled].
Incestuous is not a dirty enough word to describe what DC has become.
Do we still have skeptics in reference to The New World Order?
Ahh, I recall the days when Lazio was gonna save us from Hillary. Now we see he's just another glob of DC/Wall Street pond scum.
Tons of them from what I see.
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