February 24, 2009
TMZ.com has a report out today on Northern Trust blowing who knows how much money on a lavish party after they received $1.6 billion of TARP funds. Northern Trust is headquartered in Chicago, Illinois, with offices around the world. Frederick “Rick” Waddell is CEO.
If you are a golf fan, you will recognize the name Northern Trust, as they sponsor the Northern Trust Open, held this year at Riviera Country Club in Pacific Palisades, California (Phil Mickelson won the event this past Sunday).
According to the TMZ article, evidently Northern Trust wanted to celebrate before, during, and after the golf tournament with several lavish parties, concluding Sunday night with a final big bag at the country club. Hundreds were flown in for the week, including clients and employees, and Northern Trust put them up at the fanciest & most expensive hotels in the city. In addition, they hired some of the best known names in the entertainment field to perform at the parties. To top off the night at one party at the Loews Santa Monica Beach Hotel, they bestowed upon each female guest a bag full of gifts from Tiffany and Company.
No one really knows how much the parties cost, but TMZ reports that the band Chicago was paid around $100,000. Sheryl Crow also performed, but no report on how much she was paid.
Ok, so a measly $1.6 billion is nothing in the big scheme of the overall bailout program, which will eventually become $8 trillion. But it’s still the taxpayer’s money, and on top of that, Northern Trust laid off 450 people in December. I’m sure those ex-employees were very thrilled over the parties.
Shortly I will be publishing a post on why government regulation of banks and financial institutions is an absolute necessity, and this is a prime example of why. They not only have to be regulated, but stringently controlled. You see, there’s no money that’s more fun to spend than someone else’s (free) money.
Never underestimate the difficulty of changing false beliefs [with] facts.
Economist Henry Rosovsky