By this time the family owned just under 50 percent of the company. It appears that Gayfryd at least still has her gilded memories—the receptions for 150, the intimate dinners for 50, all that fabulous porcelain, silver, and crystal—and she’s going to make them work for her. Even now, six months after the auction of much of Saul and Gayfryd Steinberg’s vast collection of antique furniture, silver, and porcelain at Sotheby’s, Gayfryd’s friends are reluctant to talk about her, hesitant about revealing her feelings. From the outset, insurance was not Steinberg’s real interest. In the summer of 1990, Auletta, who had just joined pen’s executive board, made that public, telling New York magazine that Steinberg was a “pretty sleazy character.” There was a flurry of apologies to the Steinbergs from such writers as William Styron and Larry McMurtry, and much criticism of Auletta.

by George Baker. The Johnsons were perceived as ostentatious social climbers. On most nights, even when Saul and Gayfryd had parties to attend, the family, which soon included Gayfryd and Saul’s own daughter, Gayfryd Holden, dined together. [1] He has one brother, Robert Steinberg, and two sisters, Roni Sokoloff and Lynda Jurist. How could he have gotten into a situation so desperate that in September he was sued by his 83-year-old mother, Anne, who claimed that she was financially strapped because of Reliance’s problems and that her son would not repay $4.73 million she had lent him?

Saul was by far the most promising and ambitious of the four children, “his mother’s angel, who could do no wrong,” says a friend of Barbara Steinberg’s.

He was forced to step back from management of Reliance. Even into the 90s, after the Steinbergs had toned down their lifestyle, when people talked about them they talked about their money. Steinberg offered the Reliance shareholders a combination of convertible subordinated debentures and common stock warrants (rather than cash). He had refinanced its huge debt, issued equity, and strengthened Reliance’s board. According to court records, Saul and his brother claim the loans were related to a reorganization of family trusts and were not conventional loans, because their mother had agreed that they would be forgiven when she died. Reliance Group negotiated a transaction to be sold to Leucadia National in 2000 for stock and the assumption of debt. He was listed as a member of the class of 1959 although some accounts have said that he graduated in two years at age 18. “He had done some greenmail. It was Steinberg’s next deal, however—his 1969 attempt to take over New York’s Chemical Bank, now the Chase Manhattan Corporation—that branded him as an outcast, as a dangerous corporate social climber, “an untouchable,” says one banker.

“In the great English country homes, they live with extraordinary art and make a house a home. In 1969, Steinberg attempted to take over Chemical Bank, then one of the nation's largest financial institutions. In late May, when the insurer Leucadia National announced that it planned to buy Reliance, it seemed the Steinbergs had found a savior.

At one point it was suspected, though never proved, that several major banks united to sell Leaseco shares, driving down the price. “They’ve been misrepresented in the press, in part due to their naïveté,” says another friend angrily.

As a woman-owned business, it qualified for minority set-aside contracts. Publicly, Gayfryd behaved as though nothing were wrong. According to people who knew her then, she also worked, variously, in a travel agency, in a restaurant, and as a designer of waitress costumes for a restaurant owned by Jimmy Moran, a colorful New Orleans character. Steinberg, the company also said, would be paid his salary of $2.15 million, but would get no bonus. “Gayfryd was charming and very intelligent.” She started her own oil-pipe business, New ERA, with a friend, he recalls. Gayfryd, friends say, has been trying to get Saul to face the truth about what has happened to him. Whoever sat Gayfryd Steinberg next to Michael Shnayerson at a dinner party had a strange sense of humor. Brash and brilliant, Saul was also a maverick thinker. Barely six months later, Reliance was in serious trouble. In their nearly 17 years of marriage, Gayfryd and Saul had amassed much more extraordinary things. Some say the trouble began in 1982, when Steinberg took Reliance private, buying the shares he didn’t already own—nearly 50 percent of the company—in a leveraged buyout financed by $550 million of junk bonds. Saul, who received approximately $11.6 million in dividends that year, was paid $8.5 million, which included a bonus of 300 percent of his salary. In 1972 he was sued by the Woodmere Academy, a private school on Long Island, because he would not pay $200,000 he had pledged for a new library. Despite Gayfryd’s efforts she and her husband were not welcomed into New Orleans society. Eventually the I.R.S. In 1990, Steinberg was sued by a shareholder who claimed that the family had taken $100 million out of Reliance in dividends, salaries, and perks while private. Which is rather nice these days, when all those young billionaires have no idea what to do with their money.”. Insurance companies have lots of capital, which is just what computer leasing companies need.

This page was last modified on 23 April 2016, at 14:21. “It wasn’t just ormolu, the way it was portrayed. seized many of the Johnsons’ possessions, including their house, their art, and Gayfryd’s jewels. consultant at the time and now in the antiques business. Martzell remembers the day, shortly before Halloween, when he was with Johnson, talking to him about the prison term he might be facing. “I remember it was very sensationalistic.

I don’t know if Saul will.”. “Saul Steinberg made a lot of money very young, and he had a big family. After one suicide attempt, according to a lawsuit Gayfryd later filed to get sole custody of their son, Johnson almost ran Gayfryd down in his car as she held Rayne in her arms. He was also concerned about pen’s heavy reliance on one source of funds. “Everything they did was splendiferous.”. With a board of directors that included longtime friends—such as Carter Burden, Loral Corporation chairman Bernard Schwartz, and the banker George Baker—Steinberg was able to make business decisions that appear to have, over time, weakened the company but benefited his family. At 2:05 p.m., according to witnesses, he sat on the balcony railing, with his legs hanging over, then leaned out and dropped to his death.

Martzell, for one, dismissed the snobbery and criticism. Reliance had been in business 150 years, having been established in 1817 to provide fire insurance. In October a judge granted her motion to attach all of Robert’s assets in New York—even though his lawyer told the court that Robert’s bank might foreclose on his home if this motion was granted. It was a museum.” Among the highlights of the Steinbergs’ collection of old-master paintings was The Plague in an Ancient City, by the 17th-century Flemish painter Michael Sweerts, which was sold to the Los Angeles County Museum of Art in 1997 for $3.85 million. Throughout November and December of 1999, competitors scoured Reliance’s books. “Gayfryd was very refreshing. By then the computer business was soaring, and so was Leaseco’s stock price. Rather, it was the paid premiums insurance companies held in their coffers.

Through it all, friends say, Gayfryd was “amazing.” “She is true-blue,” says one friend. The day before the auction, she lunched with the dress designer Arnold Scaasi at Amaranth, an East Side restaurant where one goes to be seen and which was around the corner from the Steinbergs’ new three-bedroom apartment at the Helmsley Carlton Hotel. They were amazing. People say all the extravagance was her idea.

Reliance made $326 million that year, up $97 million from the year before. [10] The attempt failed.

Gayfryd had filed for divorce several weeks before, in early March. He was a pariah, mucking around in places that didn’t want him.”. “Barbara just stepped aside.”. It wasn’t yet Chase, which had been run by the Rockefellers (and merged with Chemical in 1995), but it was still one of the Waspiest pillars of corporate America. Steinberg was among those who used Milken—“and who got used by Milken,” says one banker—mainly to make money.

They discussed books that Saul recommended.

“Gayfryd would stick notes on the back door that said things like ‘Brush your teeth or die,’” he remembers.

“I remember I got Norman out of jail several months early,” says Martzell, “but by that time she was gone.”. He served as chairman of Wharton's Board of Overseers for over 15 years and continued as a member of the board until his death. The freshest-and most essential-updates from Washington, Wall Street, and Silicon Valley. But those hopes were dashed when Leucadia backed out in mid-July. George Baker, a consultant and former executive at the bank, was on Reliance’s board and eventually became the trustee of several family trusts. “They have shown great quality, great quality in travail. of shares in Reliance’s best unit, Reliance Surety.

He subscribed to The Wall Street Journal in high school and went to college at the Wharton School of Finance when he was just 16, graduating at 19. Third wife of noted New York Businessman and Financier Saul Steinberg, Gayfryd was a trustee of the New York Public Library and a popular New York Socialite. Gayfryd was on her way back from London, where she had gone to speak with Norman Johnson, who, awaiting sentencing, had fled there.

Suddenly, Saul and Gayfryd and their Wall Street friends were photographed socializing with such authors as Mailer, Allen Ginsberg, Joyce Carol Oates, Jerzy Kosinski, and Tom Wolfe. The New Orleans papers reported on her parties—including a dinner for 50, with drinks served in the pool house, and each table for 10 set with different china, crystal, and silver. “Especially after the stroke,” says a friend, “it was Gayfryd who tried to put some limit on what Saul spent. Steinberg divorced his first wife after he met. Its involvement in a re-insurance scheme with Unicover, an underwriting manager, had turned sour and would end up costing Reliance some $170 million. “My husband beat me up several times all through the years,” the paper also reported she told a judge. Her picture was constantly on the social pages of New York papers.

Although he made some investments over the years that he stuck with, in Symbol Technologies and Frank B. A year later, Gayfryd spent $1 million on Saul’s 50th-birthday party, held at their Quogue, Long Island, estate in a tent decorated as a Flemish drinking hall with 10 tableaux vivants of Saul’s favorite old masters—including Rembrandt’s nude Danaë.

As the Steinberg family battles it out, the sell-off continues.

But some things had not changed. In 1983, Steinberg married Canadian-born, Gayfryd (McNabb MacLean Johnson) Steinberg, a twice divorced Louisiana businesswoman who once ran her own steel-pipe business. Which is why so many people believed Gayfryd when she had put out the word that all was well.

In 1986, Steinberg took Reliance public again, at $10 a share.

[8] Reliance management resisted but eventually capitulated, and Leasco was successful in assuming control of Reliance in 1968.

Steinberg was born to a Jewish family on August 13, 1939, and grew up in Brooklyn, New York the son of Julius and Anne Cohen Steinberg.

It was a very specific grand taste,” she says.

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