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Howard Lutnick's Second Life

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Yet you can still hear the resentment in Lutnick's voice when he talks about feeling abandoned by his uncles and aunts and grandparents after the death of his parents. "The way I describe it, you're either in or you're out," he says. "What I learned in 1979, all my relatives -- they stepped out. We learned to live without all of them. All of them. It was just the three of us. Gary and Edie and me."

So maybe he was looking for a father figure when he walked into the World Trade Center offices of Cantor Fitzgerald in 1983, or maybe he was just hustling hard for financial security. But it didn't take long for Lutnick to become the protégé of Bernard Gerald Cantor. "Bernie saw in Howard something of himself," says Stuart Fraser. "They'd feed off each other." Cantor, who began his firm by offering tax and investment advice to such Hollywood stars as Zsa Zsa Gabor, Clint Eastwood, and Kirk Douglas, had the foresight to expand in the seventies into the lucrative bond market, making his firm an indispensable player in this secretive world. Ever on the lookout for a bargain, Cantor moved his company into the World Trade Center in 1981 when he got a great 25-year deal on the top-floor space because other companies did not want to be so high in the sky.

At 29, Lutnick, who had impressed Cantor by making millions managing the money of the founder and his friends, was designated chief operating officer and heir apparent. By 30, he was the firm's president, and for the next five years the two men ran the firm together. (There was no Fitzgerald in the firm at this point. "The rumor is that Bernie Cantor invented the name so a Jewish guy could break into the Irish-dominated bond market," says Fraser. "But John Fitzgerald was a real person, a big guy in insurance, a minor partner who died in 1964.")

The legend of Howard Lutnick is littered with sordid and sad details of his battle for control of the firm with Iris Cantor, Bernie's wife, after the company's founder became seriously ill with diabetes and went on dialysis. As Lutnick tells it, "After Bernie got sick, Iris thought she could call the shots. But that's not what the partnership agreement said."

Iris Cantor charged in court and in the press that Lutnick behaved ruthlessly in moving to have Bernie declared incapacitated. Lutnick insists that it was Iris who asked for the incapacitation documents. He says that she signed the personal papers giving her power of attorney but refused to sign the corporate-succession documents. The warring parties ultimately settled, but the relationships had turned so ugly that Iris hired security guards who literally blocked Lutnick at the door when he showed up in Los Angeles to attend Cantor's July 1996 funeral.

The ill feelings linger to this day. Lutnick, who keeps pictures of himself and Bernie prominently displayed at home and in the office, says wearily, "I loved Bernie." For Stuart Fraser, Iris Cantor's nephew, this was a family feud in which he sided with his friend, Lutnick, and there have been long-term repercussions. His mother and Iris are sisters but no longer speak. The distressed Fraser says that after September 11, "Iris didn't even call to find out if I was alive."

Her lawyer, Barry Slotnick, says that in fact, Iris did call and leave a message, asking how everyone was doing and whether there was anything she could do to help. Lutnick says the friend who took her call specifically asked if there was a message for him, or if Iris wanted a call back. "She didn't leave her phone number," says Lutnick, "so I didn't think it was a call for me."

Howard and Allison Lutnick used to have a really nice life, the kind of Upper East Side moneyed existence enjoyed by many masters of the universe who have triumphed in the nation's financial capital. There were the nights on Manhattan's black-tie charity circuit, the summers in London while Howard worked out of the firm's office there, the countless tennis and golf outings, the $7.6 million townhouse, the Rodin sculptures he collected, just as his mentor had.

Before September 11 altered his firm's balance sheet, Lutnick was said to be worth between $300 million and a billion. He owns one third of Cantor Fitzgerald and 1.5 million shares of eSpeed (which during the Internet mania traded as high as $89 per share and at press time was at less than $8). Lutnick has written large checks to his alma mater, Haverford ($15 million), dabbled in the arts (several million to the Guggenheim Museum), gotten into the name game (underwriting the Allison & Howard Lutnick Theater at the Intrepid Sea-Air-Space Museum), and backed a variety of disease-related causes.

But mention to him the source of this largesse, or those estimates of his fortune, and he goes into a defensive crouch. He insists that it's all tied up in the firm's partnership, that he hasn't taken that much money out, that he still has multimillion-dollar bank loans from buying out Iris Cantor. He bets that I have a larger brokerage statement than he does and that the net-worth calculations are all "funny money," based on the value of Cantor Fitzgerald if he were to sell the company -- which he's never shown any intention of doing.

At another time in his life, he might be unabashed about his financial success, but now it makes him profoundly uncomfortable. He's well aware that most of the young and healthy Cantor Fitzgerald employees who died had not contemplated their mortality before September 11. Only one in six opted to purchase company-subsidized supplemental life insurance of up to $1 million.

Lutnick is currently renting a serene and spacious Upper East Side triplex, with a basement playroom and first- and second-floor suites, elegantly decorated with Asian artifacts, Oriental carpets, two Rodins, and a library of art books. But these beautiful rooms feel haunted. The apartment became a command center right after the attack, as dazed survivors arrived to compile a list of the dead and the living. After Lutnick gave out his unlisted home phone to Cantor families, who were gathering at the Pierre Hotel ballroom, his phone rang 24 hours a day as he and Allison and two dozen friends -- "Our friends just showed up," she says -- took shifts in answering. Here's the dining room where he now writes his condolence notes; here's the master bedroom, with a giant wall TV and a handsome black-and-gold screen behind the king-size bed where he passes out in exhaustion for five hours each night.


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