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Last year, the city's public employee pension funds took a wonderful leap of faith and committed $150 million to help Northern Ireland dig out from decades of bloody turmoil. City comptroller Bill Thompson, who serves as a trustee and adviser to the funds, said he was convinced the deal was a good bet after he and other trustees visited there in 2006.
"We talked to people about how peace would make Northern Ireland a great place for investment," Thompson said last week. The clincher came when he was sandwiched at a luncheon between two once-bitter foes who were about to become their land's odd-couple leaders. The fervent Ulster loyalist Ian Paisley sat on one side of the comptroller, and ex–IRA chief Martin McGuinness on the other. "They asked me to help," said Thompson.
The deal was inked April 11, 2008, in New York, the 10th anniversary of the Good Friday peace agreement. Paisley and McGuinness were among the happy observers. It was to be the biggest injection of public funds ever into troubled Northern Island, targeting all those costly big-ticket items—infrastructure, alternative energy, waste management, property development—that went undone as Catholics and Protestants clashed.
As it happened, this unquestionably good deed also benefited a good friend. When the private Emerald Infrastructure Development Fund made its first filing with the Securities Exchange Commission in October, it listed one of the comptroller's oldest and closest supporters, a broker named William Howell, as its placement agent on the deal. Howell's fee, released pursuant to a Freedom of Information request last week by Thompson's office, was 2 percent of the pension fund's investment—a total of $3 million, plus unspecified bonuses.
Asked about his friend's good fortune last week, the comptroller said it had been news to him. He recalled that Howell was present at some events during the 2006 tour and that he had also helped set up meetings on the investment at the comptroller's office. "I knew he had an involvement," said Thompson. "I just didn't know he was the placement person."
But the Northern Ireland fund was just the biggest of at least three deals that Howell helped arrange for the city pension system last year alone. The comptroller's office said it couldn't detail how much he'd earned on the others. But Shelbourne Securities, the tiny Massachusetts firm where Howell is registered as a broker, shared fees with other placement agents on a $115 million city investment in a large private equity fund, as well as a $50 million biomedical fund.
Shelbourne itself is a bit of a puzzle. SEC records show that Howell collects 90 to 95 percent of the firm's fees. In 2006, federal regulators fined it $25,000 for failing to report its role in other municipal securities deals. On Friday, a man picked up the phone at the firm's office in the Boston suburb of Acton, only to quickly put it down again when told the nature of the call.
One of the many revelations of Attorney General Andrew Cuomo's spiraling pension fund investigation has been the network of insider operatives quietly mining the hugely profitable public pension funds. One such behind-the-scenes deal-maker is Bill Howell. Last month, the Voice noted that Howell, a former city official, was the big-hearted broker who split a $1.5 million fee on a state pension deal with Ray Harding, the onetime Liberal Party chief and political ally of former state comptroller Alan Hevesi. Harding allegedly did absolutely nothing in exchange for the money. He was indicted last month for fraud.
Thompson said he was "stunned" to learn that his friend had split the fee with Harding: "There was no reason for it," he said.
But Howell has also popped up in the pension scandal's growing New Mexico branch, where he was reported to have earned $125,000 for helping New York media mogul Leo Hindery land a $30 million state pension fund investment after making hefty contributions to governor Bill Richardson.
A few years ago, Howell's name was front and center in an earlier scandal after Governor Pataki, for whom Howell was a campaign fundraiser, named him to a series of state posts, including the advisory board for SUNY Old Westbury. He was forced to resign after Newsday reported on his sharp-elbowed campus deal-making, including routing lucrative contracts to friends of his and the governor's.
He surfaced as well during a federal municipal corruption probe in Philadelphia in 2004, and again when Chicago reporters first started poking into ties between ex–Illinois governor Rod Blagojevich and his generous campaign contributors.
No charges resulted in any of those episodes. Howell's eminent attorney, Gerald Shargel, said last week that his client has no criminal liability in the current investigation as well. "Bill Howell did absolutely nothing wrong," he stated, adding, "We're not going to discuss it."
Friends of both Howell and Thompson say the men have been tight throughout their careers. But Thompson, who moved last week to ban all placement agents from pension fund investments, hedged when asked to describe the relationship: "I know Howell. I know Bill," he said. "He is not one of my best friends."
He agreed, however, that their ties began in the early 1980s when they served together on the old Board of Estimate. Howell represented Mayor Ed Koch, while Thompson was deputy to Brooklyn borough president Howard Golden. The board was the city's power center back then, and its late-night bargaining sessions offered the kind of intense, under-fire conditions that make for close comradeship.
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