Queen of Mean: Leona Helmsley

Leona Mindy Roberts Helmsley (July 4, 1920 – August 20, 2007) was a billionaire New York City hotel operator and real estate investor. She was a flamboyant personality and had a reputation for tyrannical behavior that earned her the nickname “Queen of Mean.” That image of Helmsley was sealed when a former housekeeper testified that she had heard Helmsley say: “We don’t pay taxes. Only the little people pay taxes …”, a saying that became notorious and identified with her for the rest of her life. She was later convicted of federal income tax evasion and other crimes in 1989 and served 19 months in prison (and two more months under house arrest), after receiving an initial sentence of 16 years.

Early life

Leona Helmsley was born Lena Mindy Rosenthal in Marbletown, New York, to Polish Jewish immigrants, daughter of a hatmaker. Her family moved to Brooklyn while she was still a girl, and moved six more times before settling in Manhattan. She dropped out of high school to seek her fortune. In a short time, she changed her name several times–from Lee Roberts, Mindy Roberts and Leni Roberts. Eventually, she decided on Leona Mindy Roberts.[1] She legally changed her surname to Roberts.[1] She was a chain smoker, using several packs a day. Helmsley would later claim that she appeared in billboard ads for Chesterfield cigarettes, but her claim remains entirely unsubstantiated.

Her first husband was attorney Leo Panzirer, whom she divorced in 1952. Their only son was Jay (1940–1982), who had four children with his wife, Mimi. Leona was twice married to and divorced from her second husband, garment industry executive Joseph Lubin. After a brief stint at a sewing factory, she joined a New York real estate firm, where she eventually became Vice-President.

Hotel career

Leona was a condominium broker in 1968 when she met and began her involvement with the then-married multi-millionaire real estate investor Harry Helmsley. In 1970, she joined one of Harry Helmsley’s brokerage firms — Brown, Harris, Stevens — as a senior vice president. At that time, she was already a millionaire in her own right. Harry Helmsley divorced his wife of 33 years and married Leona on April 8, 1972. Leona’s marriage to Harry may well have saved her career. Late in 1971, several of Leona’s tenants sued her for forcing the tenants of one of the apartments she managed to buy condominiums. They won, and Leona was not only forced to compensate the tenants, but give them a three-year lease. Her real estate license was also suspended, but she focused on running Harry’s growing hotel empire.
Leona and Harry B. Helmsley Medical Building, the main building of Greenwich Hospital in Greenwich, Connecticut

Supposedly under her influence, Harry Helmsley began a program of conversion of apartment buildings into condos. He later concentrated on the hotel industry, building the Helmsley Palace on Madison Avenue. Together the Helmsleys built a real estate empire in New York City including 230 Park Avenue, the Empire State Building, the Tudor City apartment complex on the East Side of Manhattan, and Helmsley-Spear, their management and leasing business. The couple also developed properties that included the Park Lane Hotel, the New York Helmsley Hotel and the Helmsley Palace Hotel, and hotels in Florida and other states.

Leona Helmsley was featured in an advertising campaign portraying her as a demanding “queen” who wanted nothing but the best for her guests. However, in real life she was known for being a tyrannical boss whose petulance seemed ill-suited to the hospitality industry. The slightest mistake was usually grounds for firing, and Helmsley was known to shout insults and obscenities at targeted employees just before they were terminated.

On March 31, 1982, Leona’s only child, Jay Panzirer, died of a heart attack. Leona sued her son’s estate for money and property that she claimed he had borrowed; Mimi, her son’s widow, (who lived in a property Leona owned) received an eviction notice. Mimi later said the legal expenses wiped her out and “to this day I don’t know why they did it.”

Tax evasion conviction

Despite the Helmsleys’ tremendous wealth (between them, they were worth well over a billion dollars), they were known for disputing payments to contractors and vendors. One of these disputes would prove to be their undoing.

In 1983 the Helmsleys bought Dunnellen Hall, a 21-room mansion in Greenwich, Connecticut, to use as a weekend retreat. The property cost $11 million, but the Helmsleys wanted to make it even more luxurious than it had been before. Jeremiah McCarthy, a Helmsley executive engineer was initially put in charge of the operation. McCarthy claims that Leona repeatedly demanded that he sign illegal invoices designed to illegally bill personal expenses to the estate. According to Ransdell Peirson’s “The Queen of Mean,” when McCarthy declined to do so she exploded with tyrannical outbursts claiming, “You’re not my f***ing partner you’ll sign what I tell you to sign.” *New York Times – 08 1989.

The remodeling bill came to $8 million, but the Helmsleys were wary of paying it — or paying the taxes due on the effort. A group of contractors had to go to court to get most of the money; the Helmsleys eventually paid off most of the debt. In 1985, during these proceedings, the contractors revealed that most of their work was being illegally billed to the Helmsleys’ hotels as business expenses. “Among the charges billed to the company were a million-dollar dance floor installed above a swimming pool; a forty-five thousand-dollar silver clock; and a two-hundred-and-ten-thousand-dollar mahogany card table.” (“Rich Bitch,” September 29, 2008 New Yorker magazine). Enraged, the contractors sent a stack of invoices to the New York Post to prove that the Helmsleys were trying to write their work off in this manner. The resulting Post story led to a federal criminal investigation. In 1988, United States Attorney Rudy Giuliani indicted the Helmsleys and two of their associates on several tax-related charges, as well as extortion.

The trial was delayed until the summer of 1989 due to numerous motions by the Helmsleys’ attorneys—most of them related to Harry’s health. He had begun to appear enfeebled shortly after the beginning of his relationship with Leona Helmsley years before, and had recently suffered a stroke on top of a pre-existing heart condition. Ultimately, he was ruled mentally and physically unfit to stand trial, and Leona had to face the charges alone.

At trial, a former Helmsley-Spear executive, Paul Ruffino says that he refused to sign phony invoices illegally billing the company for work done on the Helmsely’s Connecticut mansion. Ruffino, originally engaged to assist Helmsley through the Hospitality Management Services arm, says that Leona fired him on several different occasions for refusing to sign the bills, but Harry would usually tell him to ignore her and to come back to work. Another one of the key witnesses was a former housekeeper at the Helmsley home, Elizabeth Baum, who recounted having the following exchange with Leona Helmsley four to six weeks after being hired in September, 1983 :
“ I said : “You must pay a lot of taxes”. She said : “We don’t pay taxes. Only the little people pay taxes.”

—Elizabeth Baum, former housekeeper to Helmsley (October 1983)

Helmsley denied ever saying this. Helmsley’s former employees testified at trial “about how they feared her, with one recalling how she casually fired him while she was being fitted for a dress.”[3] Most legal observers felt that Mrs. Helmsley’s personality and wealth alienated the jurors.

On August 30, Helmsley was convicted and sentenced of one count of conspiracy to defraud the United States,three counts of tax evasion, three counts of filing false personal tax returns,[7] sixteen counts of assisting in the filing of false corporate and partnership tax returns,and ten counts of mail fraud.[8] (See United States v. Helmsley, 941 F.2d 71, 91-2 U.S. Tax Cas. (CCH) paragr. 50,455 (2d Cir. 1991), cert. denied, 502 U.S. 1091 (1992).)

She was, however, acquitted of extortion — a charge that could have sent her to prison for the rest of her life. She was sentenced to 16 years in prison, but eventually had that sentence significantly reduced when all but eight of the charges were dropped.[1] Nonetheless, when it was clear she was going to jail, she collapsed outside of the courthouse, later diagnosed with a heart irregularity and hypertension.

She was ordered to report to prison on tax day, April 15th, though she had been convicted the previous August.

Although Helmsley’s reputation as the “Queen of Mean” is sealed, Helmsley was generous in her charitable contributions after her prison term. After September 11, 2001, she donated $5 million to help families of New York firefighters. Among other contributions, she also gave $25 million to New York’s Presbyterian Hospital for medical research.

After prison

Helmsley served 18 months in federal prison. Her later years were apparently spent in isolation, especially after Harry died in 1997, leaving Leona his entire fortune (including the Helmsley hotels, the Helmsley Palace and the Empire State Building), estimated to be worth well in excess of $5 billion. She had almost no friends but Dr. Patrick Ward, Rodrigo Handall from Mexico, and Kathy and Rick Hilton.A 2001 Chicago Sun-Times article depicted her as estranged from her grandchildren and with few friends, living alone in a lavish apartment with her dog.In 2002, Helmsley was sued by Charles Bell, a former employee who alleged that he was discharged solely for being homosexual. A jury agreed and ordered Mrs. Helmsley to pay Bell $11,200,000 in damages. A judge subsequently reduced this amount to $554,000.

She was forced to give up control of her hotel empire since New York does not allow convicted felons to have alcohol licenses; nearly all of her hotels sold alcohol at their bars. Mrs. Helmsley lived her final year at her luxurious penthouse atop the Park Lane hotel, with magnificent views of Central Park.

Death

Leona Helmsley died from congestive heart failure at the age of 87, on August 20, 2007, at Dunnellen Hall, her summer home in Greenwich, Connecticut.[12] Cardiovascular disease ran in her family, claiming the lives of her father, son and a sister.After a week at the Frank E. Campbell Funeral Chapel, she was entombed next to Harry Helmsley in a mausoleum constructed for $1.4 million and set on ¾-acres in Sleepy Hollow Cemetery, Westchester County, New York.
The mausoleum of Harry Helmsley in Sleepy Hollow Cemetery

Helmsley left the bulk of her estate — estimated at more than $4 billion — to the Leona M. and Harry B. Helmsley Charitable Trust.She also left her Maltese, Trouble, a $12 million trust fund.[18] This sum was subsequently reduced to $2 million less than a year later. She left $15 million for her brother Alvin Rosenthal. Helmsley had four grandchildren. Two of them each will receive $5 million in trust and $5 million outright, under the condition that they visit their father’s grave site once each calendar year. Her other two grandchildren, Craig and Meegan Panzirer, received nothing.

It has been alleged that they were omitted from the will because they failed to name any of their children after her late husband. Her choice to leave $12m to her white Maltese, Trouble, was branded 3rd in Fortune’s “101 Dumbest Moments in Business” of 2007.[19] In an April 30, 2008 court ruling Manhattan Surrogate Judge Renee Roth reduced the trust fund for Trouble from $12 million to $2 million with the $10 million going to Helmsley’s charitable foundation.[20] She also left her chauffeur, Nicholas Celea, $100,000.

However, in the April 30 judgment (published only on June 16, 2008), Manhattan Surrogate Court Judge Reena Roth further ruled Helmsley was mentally unfit when she executed her will. Hence, the Court, amid settlement, awarded $4 million to the charity, and $6 million to Craig and Meegan Panzirer, who were disinherited by the will (if they would keep silent about their complaint with their grandmother and deliver to her any documents). 9-year-old Trouble lives in Florida with the Carl Lekic, general manager of the Helmsley Sandcastle Hotel amid receiving several death threats.[23][24] Lekic, Trouble’s caretaker, stated that $2 million would pay for the dog’s maintenance for more than 10 years – the annual $100,000 for full-time security, $8,000 for grooming and $1,200 for food. Lekic is paid a $60,000 annual guardian fee.”

In addition to $12 million Leona Helmsley left to her pet Maltese, Trouble, she left instructions that a trust valued at $5 billion to $8 billion be used to benefit dogs.