Whopper of the Week: 92nd St. Y.

Gossip, speculation, and scuttlebutt about politics.
Nov. 15 2002 3:02 PM

Whopper of the Week: 92nd Street Y

A $1 million donation is pronounced chump change.

"No child is guaranteed admission here. Every child—every child—goes through the same rigorous admissions process. The implication that a large donation—and it is by no means one of our largest—can grease the process is just not true. The only thing the 92nd Street Y takes into account is the children themselves."

Alix Friedman, director of public relations for the 92nd Street Y, where Jack Grubman's twins attend preschool. Grubman is a former telecom analyst for Salomon Smith Barney, a unit of Citigroup, which is currently being investigated by New York attorney general Eliot Spitzer. Friedman was quoted in the Nov. 15 New York Times.

"On another matter, as I alluded to you the other day, we are going through the ridiculous but necessary process of pre-school applications in Manhattan. … Of the schools we've looked at, the 92nd Street Y is, without question, the one we'd love our children to attend. … Given that it's statistically easier to get into the Harvard Freshman Class than it is to get into pre-school at the 92nd Street Y (by the way, this is a correct statement), it comes down to 'who you know.'

"Attached is the list of the Board of Directors from the 92nd Street Y. Fred Salerno is helping me with [board member] Patricia Cayne, who I think is Jimmy Cayne's wife from Bear Stearns, and Fred is on the Board of Bear Stearns or at least was. However, if you feel comfortable and know some of these board members well enough, I would greatly appreciate it if you could ask them to use any influence they feel comfortable in using to help us as well. I noticed Bill Heyman is on the board and I think he works somewhere in the Citigroup corporate structure but I don't really know Bill.

"Anyway, anything you could do Sandy would be greatly appreciated."

Memo from Grubman to his boss, Citigroup chief executive SanfordI. Weill, Nov. 5, 1999. (If you subscribe to the Wall Street Journal's online edition, you can click here for the complete document.)

"Although my effort to help an employee's children is what led me to call the 92nd Street Y, the Y is a superb institution and our support is consistent with Citigroup's philanthropic efforts. Through a $200,000 per year, five-year commitment, we now fund an outstanding program of concerts, literary readings, dances and lectures that enhances the cultural life of New York."

Citigroup chiefWeill, in a Nov. 14 press release.

"You know everyone thinks I upgraded [AT&]T to get [an inside track on financing AT&T's wireless unit]. Nope. I used Sandy to get my kids into 92nd St. Y pre-school (which is harder than Harvard) and Sandy needed [AT&T chairman and Citigroup director C. Michael] Armstrong's vote on our board to nuke [Citigroup co-chairman John] Reed in showdown. Once coast was clear for both of us (ie Sandy clear victor and my kids confirmed) I went back to my normal negative self on [AT&]T. Armstrong never knew that we both (Sandy and I) played him like a fiddle."

E-mail from Grubman to an analyst at another company, Jan. 13, 2001. Available to WSJ.com subscribers here.



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