With Mitt Romney as its de facto candidate, the roster of Restore Our Future, Romney’s designated Super PAC slush fund, reads like a laundry list of New York City’s wealthiest denizens. And, according to the Center for Responsive Politics and contrary to popular belief, Super PAC’s are receiving a huge majority of their donations from these single individuals rather then enormous corporations.
So, here at the Voice, we’re going to tell you a little bit about our neighbors, one donor at a time:
In the second edition of ‘Mitt Loves N.Y.,’ we profiled Bruce Kovner – the millionaire financier behind Caxton Associates was an eclectic blend of One Percent rugged individualism and outstanding philanthropy. The facets of an obscene personal fortune mixed with charity tends to always produce a love-hate relationship.
(And we haven’t checked on Kovner in a while: turns out he’s been making news lately with a donation of $300,00, along with his wife Suzanne, to YG Action Fund, a smaller pro-Romney SuperPAC that is fronted by House Republican Majority Leader Eric Cantor. Looks like he’s doing just fine.)
But back to what we were saying: when a profiteer flashes his or her generous side, we are desensitized to the facts – we became dogs who follow the shiny ball placed in front of our eyes. This isn’t necessarily a bad thing; money works in mysterious ways, especially when there is a shit ton of it to go around.
But why mention Kovner? The Caxton man is old news in relation to how far we’ve come with this series. However, his personal and professional life bear a striking similarity to our next target: Mr. Robert Rosenkranz.
Should we start with the good news or the bad news first? It’s Saturday so we’re in a great mood; let’s start with the sunny vibes.
In 1985, Rosenkranz used his profits to start the appropriately-named Rosenkranz Foundation. Working on behalf of conservative think tanks Kovner frequented as well, like the Manhattan Institute and the American Enterprise Institute, Rosenkrantz’s non-profit organization seeks to inspire the public to discuss the matters of the day. And he has done just that only a few blocks from the Voice‘s headquarters with the Intelligence Squared U.S. debate series, an event hosted at NYU’s Skirball Center.
Along with all of this charitable fun, Rosenkranz has an affinity for Asian art. His Foundation has endowed a bunch of exhibits on the subject at the Guggenheim, where his wife, Alexandra Munroe, is the Senior Curator of Asian Art, and he has bankrolled a few collections and book series at his alma maters, Harvard and Yale. He is also a member of the Council on Foreign Relations and the Film Society of Lincoln Center.
Okay, moving on to the impending rain clouds. On 1105 North Market Street in tax-friendly Wilmington, Delaware, just blocks from the infamous 1209 North Orange Street that houses thousands of corporations, lies the headquarters of Rosenkranz’s financial brainchild, Delphi Financial Group, Inc. Described as a “financial services company focused on specialty insurance and insurance-related business” on its website, the Yale graduate started his business, which now oversees $8 billion worth of assets, soon after leaving an economist post at the foreign policy think tank known as the RAND Corporation.
Just like his buddy Mitt, Rosenkranz started two private-equity firms called Acorn Partners LLC and Pergamon Advisors LLC. We have no idea where the names for these types of things come from, either. And, as we’ve mentioned before about the private equity community, the members involved like to stick together: in March of this year, Rosenkranz donated $150,000 to Restore Our Future.
Let’s dig a little deeper, shall we? The Delaware tax havens have been referenced a few times in our series – the New York Times‘ Leslie Wayne did a great profile of the corporate scene there last month – because it is the home of many of these donors’ companies. Why? The tax code there acts as a shield against the collectors at the IRS; it’s like a Cayman Islands for those unwilling to travel a few miles south.
Well, in the past year, the judges of the state have been getting a little angry at these companies for using the leniency to their advantage, thus leading to shady transactions at said enterprises. Naturally, Rosenkranz’s Delphi is of concern. This year, the “corporate chieftain” decided to sell his company to their current owner, Tokio Marine Financial.
But he wanted a little bit more out of the deal then everyone else, even though, technically, he has a 49.9% share hold of the company. Instead of the mathematically deduced amount, he demanded that he received a whopping $110 million more than the other suckers involved. And that number is a result of negotiations that shaved off about $50 million. Also, Sam Glassock III, the Delaware judge on his tail, noted that, in other “troubling” side deals, Rosenkranz tried to suck out another $57 million from the deal. Because, in total, $167 million is not enough for the Chairman.
These demands run completely in opposition to the Delaware tax code and Delphi’s charter, which limits the amount of power Rosenkranz can have over his own company – a financial Magna Carta, if you will. Hence why the courts are on his case now. To sidestep that, he attempted to rewrite the charter in which there was only one winner in the end. We’ll leave you to guess who that is.
We told you that it’s a love-hate relationship, right?
(The Voice reached out to Delphi Financial but the e-mail provided no longer exists and the telephone number provided endlessly rang.)