| Penny Pritzker | |
|---|---|
| Born | 1959/1960 (age 51–52)[1] Chicago, Illinois |
| Residence | Chicago, Illinois |
| Citizenship | United States |
| Alma mater | Harvard University, Stanford University |
| Occupation | Businesswoman |
| Net worth | US $ 1.7 billion (est.) (September 2011)[1] |
| Political party | Democratic |
| Spouse | Bryan Traubert |
| Children | two |
Penny Sue Pritzker (born 1959) is an American business executive, and a member of the Pritzker family of Chicago, one of America's wealthiest business families. She is the founder and current Chair of Classic Residence by Hyatt, or Vi, a chain of luxury senior living communities spread throughout the United States, and the national finance chair of Barack Obama's presidential campaign. In 2011 the Forbes 400 list of "America's wealthiest" showed her as the 263rd richest person in the U.S., estimated net worth of US $1.7 billion.[2] Also in 2011 Forbes listed her as the world's 651st richest person.[2]
On November 20, 2008, CNN reported that Pritzker was Barack Obama's top choice for Commerce Secretary, quoting "multiple" unnamed sources.[3] However, it was later reported that because of her involvement in the failure of subprime lender Superior Bank, Pritzker took herself out of the running.[4][5][6]
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Born in 1959, Pritzker is a member of the Pritzker family, a notable and influential Jewish American business family. Pritzker is a daughter of Sue (Sandel)[7] and Donald N. Pritzker (1932–1972), co-founder of the Hyatt hotel chain, which grew dramatically under his leadership as President from 1959 until his death in 1972. She attended Castilleja School[8] until 1977.[9] She earned a BA in Economics from Harvard College (1981), and a JD/MBA from Stanford University (1984).[10]
Pritzker is involved in the reform of Chicago’s public education system. Currently she is chair[12][13] of the Chicago Public Education Fund, the successor organization to the Chicago Annenberg Challenge.[14]
Pritzker contributed some $493,174[15] to numerous campaigns and political action committees since the 2000 election cycle. Among the recipients have been the presidential campaigns and exploratory committees, including those of George W. Bush, Joe Lieberman, Bill Bradley, Rudy Giuliani, John McCain (2000), Al Gore, John Kerry and Hillary Clinton.[16]
Since the spring of 2008, Pritzker has served as Barack Obama's National Finance Chair.[17] On Wednesday July 2, 2008, Ms. Pritzker and her husband hosted a $28,500 per plate fundraiser for Mr. Obama's campaign in Chicago with Warren Buffett and his wife, and Obama advisor Valerie Jarrett. [18]
She is also a member of the Council on Foreign Relations[19] and President Barack Obama's Economic Recovery Advisory Board.
Ms. Pritzker has been associated with the Subprime mortgage crisis. Ms. Pritzker's late uncle, Jay Pritzker, purchased a 50% stake in Hinsdale, Illinois-based Superior Bank of Chicago in 1989 from the Federal Deposit Insurance Corporation, which had taken over the bank when it failed in the late 1980s.[20] Penny Pritzker became chairman of the bank in 1991. Under Ms. Pritzker's chairmanship, the bank "embarked on a business strategy of significant growth into subprime home mortgages," according to a 2002 report by the United States Treasury Department.[20] She stepped down from the chairmanship in 1994 but continued to serve on the board of the holding company, Coast to Coast. In the months leading up to the 2001 seizure, she tried to work out a major recapitalization plan to "once again restore Superior's leadership position in subprime lending."[20] In July 2001, FDIC seized the bank after the recapitalization could not be resolved. .[21][22] Subsequently, the Pritzker family reached an agreement with regulators to pay $460 million over 15 years toward the costs of the closure; these funds will go towards reducing the costs of the FDIC's losses and partially reimburse depositors with accounts in excess of FDIC insurance limits.[20][23][24][25]
More than a thousand Superior Bank depositors are still owed money, and industry experts have criticized Pritzker's handling of the situation.[26] Consumer advocates as well as government investigators have asserted Superior "engaged in unsound financial activities and predatory lending practices."[20] Responding to questions from the Wall Street Journal, Ms. Pritzker noted she had no ownership in the bank, either direct or indirect, and that the bank's reasons for failure "were complex. They include changes in accounting practices, auditing failures, reversals in regulatory positions and general economic conditions."[20] She said the bank complied with "fair lending laws" and ethical business practices.[20] Writing about the largest thrift failure in almost a decade, the FDIC in 2002 noted that the bank had paid out $200 million in dividends during a time of seemingly rising profits; in reality, these profits were a product of "flawed" accounting and masked operating losses.[20] Pritzker noted in turn that Superior's financial statements were found to be acceptable by regulators for many years before the failure.[20] A 2001 Business Week article described the bank's other half-owner, Alvin Dworman, as the more dominant partner in its operation as a result of agreements Jay Pritzker made early on.[21] Quoted in the New York Times about the failure of the bank, a Pritzker family friend observed Pritzker was trapped in a deal of her uncle's making: "Penny got sucked into this … This was really the legacy of Jay." [27] Yet Jay Pritzker passed away in 1999 and the bank got in trouble and was shut down in 2001, and Penny Pritzker endorsed the bank's subprime lending practices and badly mishandled the bank's finances as evidenced in a letter written by her just months before the bank's collapse. In it she wrote she intended to "once again restore Superior's leadership position in subprime lending.".[26]
Accused of looting family trusts, Ms. Pritzker and cousins Tom and Nick were sued by cousin Liesel Pritzker and Matthew Pritzker who claimed fraud and sought damages in excess of $6 billion.[28] In early 2005, the parties settled the lawsuit which led to the family fortune being split 11 ways, resulting in 10 more Pritzkers joining the Forbes 400; the most members of any family.[29] Under the settlement, Liesel and Matthew each received roughly U.S. $280 million in cash and were given more control over other trusts valued at about U.S. $170 million each.[30]