The Billionaire Who Wasn't (39 page)

The statement also disclosed that of the $610 million paid out in 1,500 grants since 1982, $291 million had gone to higher education, $89 million to children and youth, $48 million to the nonprofit sector, and $23.5 million to aging and health. Another $148 million had been given to overseas charities. The single biggest beneficiary was Cornell University. The document listed twenty-seven “representative” grant recipients who had been authorized to confirm that they had received funding for worthy projects. It said Price Waterhouse would assure reporters that they had certified the accounts of the Atlantic Foundation and the Atlantic Trust throughout the years they had operated in secrecy.

Harvey Dale's chief of staff, Chris Pendry, simultaneously sent “blast faxes” to the hundreds of beneficiaries who had previously been told only that the money came from a New York consulting firm that acted for a number of anonymous donors. They were informed now that this had been a fiction. There was really only one anonymous donor, Chuck Feeney.

The world of philanthropy in America was set alight with the news that in its midst was a previously unknown and active foundation, that if based in the United States, would be the fourth-largest of America's grant-making foundations. Only the Ford, Kellogg, and Robert Wood Johnson foundations had greater assets. Atlantic was bigger than the Pew, Lilly, MacArthur, Rockefeller, and Mellon foundations, and it operated with a tiny staff of a few dozen professionals in the United States and overseas.

The positive tone of Judith Miller's report set the agenda for everyone else. The print and electronic media enthused about the secret giver, who was so little known that one network put up the wrong photograph on the television screen. All across the United States, newspapers carried a glowing
Associated Press
story that produced headlines like that in the
Star-Ledger
in Newark, New Jersey, the newspaper read by Feeney's family and childhood friends: “Tycoon's watch might be cheap, but his charitable heart is solid gold.” The
Royal Gazette
in Bermuda delightedly pointed out that “Bermuda's discreet banking laws provided perfect cover for his clandestine giving.”

In the
Washington Post,
playwright Jane Stanton Hitchcock suggested that Chuck Feeney had restored the good name of Anonymous, and she advocated the creation in his honor of a “Room of the Unknown Donor,” where people could contemplate doing something “both satisfying and legal that no one would find out about.” Another public accolade came from
Time
magazine, which listed Feeney, Princess Diana, and Alan Greenspan, as runners-up for the title of 1997 Man of the Year to Andrew Grove, chairman and CEO of Intel and the champion of the microchip. “Feeney's beneficence already ranks among the grandest of any living American and may someday make him the most generous American philanthropist of all time,” declared
Time.
In an age of aggrandizement, “Feeney showed that humble hearts still beat. In many ways, that is a revelation even more gratifying than the sums he has given away.”

The news of Feeney's beneficence delighted Tom Harville, who had walked out of DFS in 1977 because of his distaste for the way the DFS owners were accumulating money, and who later became CEO of Le Bon Marché. “When I first read the story about Chuck's anonymous and hugely generous philanthropy, I was instantly reminded of my reasons for leaving DFS and how thoroughly I had misjudged him,” he said.

Feeney received hundreds of letters from Cornellians, Irish Americans, business contacts, beneficiaries, and old school friends in Elizabeth, New
Jersey, full of warmth, pride, and praise for what he had done. Don Keough, former head of Coca-Cola, wrote to Feeney, saying, “You are a model for all of us.” Feeney's early partner in the duty-free business, Harry Adler, wrote complimenting him for reaching the top level of
tzedakah,
or charity, in the Jewish faith, giving anonymously to enable the recipient to become self-reliant. Fred Antil, his friend and Cornell alumus, sent Feeney a note saying the
New York Times
had missed the point—that his greatest contribution to mankind had been introducing him to his wife, Ann. Feeney responded: “Delighted to know this. But I don't think you read the small print. Matrimonial introductions ten percent of lifetime earnings. PS. If it doesn't work out, you get a ten-percent rebate.” One of his former sandwich makers at Cornell, Tass Dueland, then a veterinarian professor living in Madison, Wisconsin, recalled his delight at the news. “Ask him, by the way, since I was his first employee, when is my pension going to come?”

Judith Miller, who often reported on terrorism (and who later would go to jail for not revealing the source of a leak from the Bush White House), made only passing reference to Feeney's support for the IRA's political wing, Sinn Fein. Most Americans knew little of the conflict in Northern Ireland. Among leading Irish Americans in the know, Feeney was highly regarded, even revered, for what he had done for peace on the island of their ancestry. Only one critical letter appeared in the
New York Times
, from Thomas J. Flynn of Fairfield, Connecticut, wondering how Feeney could “be so taken in by the myth of Irish nationalism that he thinks his donations to Sinn Fein supported only nonviolent activities.”

In Ireland, further public approval followed.
The Irish Times
, Dublin's leading daily newspaper, focused on the revelations about Feeney's massive gifts to Irish universities, comparing his philanthropy to that of one of Ireland's richest businessmen, Anthony O'Reilly. “The main difference between the two men's actions is obvious,” wrote Bernice Harrison in
The Irish Times
. “Mr. Feeney mostly gave anonymously . . . Dr. O'Reilly's donations are very public and as such perhaps buy the businessman a kind of immortality.”

Coverage of Feeney in the British tabloid press was generally positive. But the
Mirror,
under the headline “Fury over Sinn Fein $4 billion man,” alleged that the gift to Sinn Fein by the “elderly eccentric” billionaire had attracted flak “from furious peace groups and Protestants.” The “furious peace
groups and Protestants” it cited were two people associated with a pressure group called Families Against Intimidation and Terror in Northern Ireland, which campaigned against the paramilitary practice of knee-capping victims, and which received funding from an Irish American with unionist sympathies. One of its founding members, Nancy Gracey, complained to the paper that Feeney was “giving blood money to the very people causing all the hurt and pain.” But the
Mirror
also noted that Feeney was “no sectarian benefactor,” having contributed to both sides in Northern Ireland. In an editorial headlined “Chuck's Got a Heart of Gold,” it concluded that in a world dominated by greed, Mr. Feeney's secret philanthropy “is as refreshing as it is extraordinary.”

Peace groups were in fact far from furious with Chuck Feeney. The leading cross-community peace group, Cooperation North, later renamed Cooperation Ireland, alone had received $10 million from the Atlantic Foundation. Many such nonprofit bodies depended on Feeney and Atlantic for their existence. “Reconciliation and human rights were important areas that needed funding in Ireland and we wanted to see the potential of funding such organizations,” said Feeney. “In the press they say that half the people I fund in Northern Ireland are Republicans: the logic of that is that the other half must be Loyalists.”

John Healy had been apprehensive about the safety of Atlantic staff in Belfast in case a “loyalist bomb-tosser” misunderstood Feeney's contributions to peace, so he consulted an international security firm, Risk Management International, for advice. “Our worries were unfounded. We didn't get a single phone call in Belfast from anybody. We lived a charmed life in Belfast. In the Republic, we got a cascade of applications.”

The DFS sale did result in one assessment of Feeney's role in Ireland that upset him deeply. It came in the book by Airy Routier about Bernard Arnault that was published in France. “Opposed to the idea of inheritance . . . Chuck Feeney gives his money for diverse humanitarian causes but also for the IRA, the secret Irish army, of which he is one of the financiers,” Routier wrote. “Chuck promised Bernard that the sale of DFS would allow him to finance medical research. But only the God of Catholics and Chuck Feeney know how he will use the money of LVMH!”

Many people in France knew Feeney from the time he lived there and would be exposed to this libel. Two of his children, Juliette and Patrick, lived
in France and friends asked them, “Is your father supporting the IRA?” They saw how hurt their father was. “It totally sucked,” said his daughter Leslie. “He is such a pacifist, a humanist; the insinuations were totally unfair. The book really pissed him off.”

Years later, a Liberal Party member of the Victoria Parliament in Australia, Phillip Honeywood of Warrandyte constituency, alleged in a parliamentary debate that funding for the Melbourne Institute of Technology had come from “a Bermuda-based entity, Mr. Charles Feeney, who is a long-standing major donor to the Irish Republican Army.” The Melbourne
Age
reported the comment the next day under a headline that read, “Uni[versity] Benefactor Has IRA Ties, says MP.” Feeney was also “pissed off” by this comment, from a minor politician who “couldn't get press any other way but for some reason wanted to get up our nose.” The article caused momentary panic among some Australian beneficiaries of his foundation until they checked with contacts in Ireland and got the full picture.

As the dust settled and the media attention faded, Harvey Dale congratulated everyone in the foundation for the success of the unveiling. “The
New York Times
story and virtually all the ensuing international media coverage was very favorable to us,” he wrote in a report to directors about the “most significant event” in their history. “None of our worst fears of distortion or unfavorable ‘spin' were realized.” In fact, he boasted, one of his “spook” friends, who served on President Clinton's Foreign Intelligence Advisory Board, had described the unveiling of Chuck Feeney as “a Great Op.”

Despite everything, Chuck Feeney and Harvey Dale were still not prepared to give up the culture of secrecy. The Atlantic Foundation and the Atlantic Trust, which in the wake of the sale were brought together under a single title, The Atlantic Philanthropies, went underground again. Anonymous giving had allowed them to avoid the “crowding out” effect, where other potential benefactors were deterred by funding from a highly visible person with a great fortune, argued Dale in his post-sale report. “We still adhere to two long-standing attributes of our style of grant-making: we don't accept unsolicited proposals, and we insist that our donees keep the source of their gifts confidential.”

Atlantic sent a message to all beneficiaries, stating in bold-faced type that they had not been released from their pledges of confidentiality unless specifically authorized. “Our conditions that you not identify the source of the gift remain in force,” it proclaimed. “Please let the appropriate individual
in your organization know of this continued requirement.” Other rules stayed in place: No announcements of awards would be allowed, and recipients would still have to sign confidentiality documents and promise not to seek contact with the donor.

While the focus was on the DFS sale, Feeney's investments were bringing in more huge sums. In 1996, investments in companies such as Price-line. com Inc., E*Trade Group Inc., Sierra Online, and Baan Co. produced a capital return of $403 million. The sale of a stake in Legent Corporation to Computer Associates in 1995 brought in another $173 million.

Of the overall assets of $4 billion, $1 billion was now tied up in “state,” or businesses and property, and the rest was in “church.” When the Atlantic Foundation was first launched, 90 percent of the assets were in “state” and only 10 percent in liquid form. The proportion in cash now shot up to 75 percent. It would continue to rise. After some twenty years of acquisitions and expansion, Chuck Feeney would now wind down his multinational conglomerate, or as Dale put it in his report to directors, bring General Atlantic Group's various businesses “to ripeness for harvesting.”

There was a “tipping point” in favor of the foundation over GAGL, recalled Chris Oechsli, and from then on “we were on a trajectory to divest ourselves of the operating assets.” They had already started the process with the sale of Cannon's sports club in London to Vardon, the owner of the London Dungeons, for $40 million and of the Medallion Hotels in Texas and Oklahoma, which in January 1998 brought in a further $150 million.

Harvey Dale noted in his report that in the early 1990s, their liquidity had been so constrained that it had caused “extreme distress both to the donees and to us”—a reference to the drying up of DFS dividends at the time of the Gulf War. Now they need no longer worry about dividends drying up. In the post-sale landscape, Atlantic Philanthropies could spend more than 5 percent of the asset base, “even if that shrinks the value of our portfolio over time.” A 5-percent spend rate would be about $200 million a year. In their previous year, they had given grants totaling $140 million. They could now go far beyond that.

Chuck Feeney was much in demand after he was outed by the
New York Times.
The U.S. networks clamored for interviews. However, following his call from the airport, Feeney did not give another media interview for several years, and his foundation ignored regular requests from CBS
60 Minutes
producers to appear on their program. After he gave his interview with
Judith Miller on the pay phone in the San Francisco airport, he flew out of the country on one of his frequent around-the-world trips. Having featured in public through circumstances beyond his control, he resolved to disappear again and revert to the anonymity in which he had always taken refuge. Harvey Dale advised him how to react if confronted by paparazzi on his travels
.
The lawyer had hired a professional photographer to demonstrate how to prevent a cameraman from getting a recognizable picture of a targeted person. He passed on the advice to Feeney: Close your eyes as a photographer raises his camera, or put a hand over your nose and mouth.