The World Trade Center Demolition as an Insurance Scam
Larry Silverstein and his partner
Frank Lowy acquired a 99-year lease on the entire World Trade Center complex
just weeks before the 9/11/01 attack. The deal was negotiated by Lewis
Eisenberg, the former chairman of the Port Authority of New York and New
Jersey. Eisenberg was recently appointed chairman of the Republican National
Committee. Eisenberg had resigned from Goldman Sachs in the 1980s after his
secretary accused him of sexually harassing her. When New Jersey Gov. Christine
Todd Whitman appointed Eisenberg chairman of the Port Authority, in February of
1996, Forbes Magazine wrote that it was "a strange political
appointment, considering the part he played in the sex scandal that rocked Goldman
and the financial community in the late 1980s."
Silverstein had built Seven World
Trade Center in 1987 on property leased from the Port Authority, but the
six-building World Trade Center complex remained under public control until
Silverstein and Lowy obtained the 99-year lease on July 26, 2001. The new deal
left Silverstein in control of 10.6 million square feet of WTC office space,
and gave Lowy control of the 427,000-square-foot retail mall in the WTC
basement.
Return
on Investment
Slightly more than a year after the
attack, The New York Times reported that developer Larry Silverstein and
investors Lloyd Goldman and Joseph Cayre were close to receiving about $98
million from their down payment of $124 million toward the 99-year lease of the
World Trade Center. Under the arrangement Silverstein would retain control over
rebuilding office space at the site. 1
Lender GMAC Commercial Mortgage
Corporation accused Silverstein of misallocating insurance awarded him for the
9/11/01 attack. In a complaint filed on Jan. 14, 2002 in the State Supreme
Court in Manhattan the lender maintains Silverstein used some of the insurance
money to pay lobbyists in Washington and Albany to limit his liability to the
victims.
See this archive of articles about the insurance aspects
of the World Trade Center destruction.
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