Accused swindler Starr invested in ‘private CIA’
Kenneth I. Starr, the disgraced financial adviser with an A-List stable of Hollywood clients, was a major investor in GlobalOptions, a controversial Washington firm that once billed itself as “a private CIA,” financial filings show.
Starr is charged with swindling at least $59 million from a glittering list of film and media stars including Uma Thurman, Al Pacino, Martin Scorsese, Neil Simon, newscaster Diane Sawyer and photographer Annie Leibovitz.
Federal agents found him hiding behind coats in his closet on May 27, "forcing them to yank him out by the collar," the Associated Press reported.
Starr “was an early investor in GlobalOptions,” according to a former employee. SEC filings show that he had major investments in the company as recently as January 2009.
Since its founding in 1998, GlobalOption’s board of directors has also included Starr’s son, Ronald, who is also managing director of his father’s investment firm.
So many of Starr’s clients were stockholders in GlobalOptions that the company felt compelled to tell the SEC that the cross-ownership “would not interfere with [Starr’s] independence, as defined by Nasdaq’s rules and regulations."
GlobalOptions was founded by Neil C. Livingstone, a behind-the-scenes adviser to Reagan White House official Col. Oliver North during the arms-for-hostages deal with Iran. Livingstone left the company in late 2006 to start a similar firm, Executive Action LLC, headquartered in Dupont Circle. He took GlobalOptions' "private CIA" with him.
“Think of us as a McKinsey & Company with muscle,” a brochure for Executive Action says, "a private CIA and Defense Department available to address your most intractable problems and difficult challenges."
While Livingstone was still CEO of GlobalOptions, the firm said its foreign clients operated "primarily in Russia and the Caribbean,” according to an SEC filing unearthed by Harper’s magazine blogger Ken Silverstein in 2007.
One was Ukrainian businessman Dimytro Firtash, who “brokered several billion-dollar deals between Gazprom and the government of Ukraine,” which drew “criticism from the U.S. ambassador to the Ukraine at the time for the deals’ lack of transparency,” according to the Wall Street Journal.
Now headed by Harvey Schiller, a former sports and broadcasting business executive and onetime executive director of the U.S. Olympic Committee, GlobalOptions today stops short of advertising itself as “a private CIA.”
But the heart of its business remains in security services and corporate intelligence.
“With a single call, through a single point of contact,” the company’s brochure says, “you can access our entire array of international risk services – from security and investigations, to disaster preparedness and management, to fraud prevention and litigation support.”
The company did not return a call seeking comment.
Livingstone, reached by telephone Friday, said he is no longer privy to the internal workings of GlobalOptions, but doubted the firm was damaged by the collapse of Starr’s financial empire.
“I don’t think it will hurt them,“ he said.
Livingstone, who was once accused by GlobalOptions of stealing the firm’s clients -- "it was settled in my favor,” he said -- also said none of Starr’s clients invested in Executive Action.
The Paris-based newsletter Intelligence Online reported Thursday that GlobalOptions “carried out numerous missions on behalf of Kenneth Starr and his clients” when Livingstone ran the company.
But Livingstone, now mulling a run for governor in Montana, his home state, described the "missions" as “the routine problems and issues that show business people get into” -- stalkers, missing children, accusations of sexual dalliances, property stolen by household help and the like.
“Mundane stuff, nothing spooky or unusual,” he maintained.
Two principals of GlobalOptions, former FEMA chief James Lee Witt and former New York City police commissioner Howard Safir, recently announced their departure from the company, shortly before the Starr indictment was handed down.
The company’s advisers have included such national security luminaries as former FBI directors William S. Sessions and William H. Webster (who also headed the CIA in the 1980s), former CIA director James Woolsey and former NATO commander Wesley Clark.
| June 11, 2010; 4:35 PM ET
Categories: Financial/business, Intelligence, Lawandcourts | Tags: Al Pacino, Annie Leibovitz, Diane Sawyer, Howard Safir, James Lee Witt, James Woolsey, Martin Scorcese, Neil Simon, Uma Thurman, Wesley Clark, William S. Sessions and William H. Webster
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