Free The last tycoons: the secret history of Lazard Frères & Co by William D. Cohan Page B

Polish Jews then living in Germany. The Germans rounded up the Polish Jews and transported them to near Posen, on the Polish side of the border with Germany. Poland shunned these refugees as well, and many of them died of starvation and exposure during the harsh winter.
    With a war in Europe looking more and more inevitable by Christmas 1938, the David-Weills and Andre Meyer took the opportunity to rewrite the Lazard New York partnership agreement. The estate of Andre Lazard had been settled by this time, and there must have been some recalibration of his family's ownership stake in the firm. The ostensible reason for the change, according to Michel, was the need to legally separate the French partnership from the New York partnership in the event that the Germans took control of Lazard in Paris--which they eventually did--and endeavored to run the New York firm (which they did not). The change in the agreement was designed to prevent such an event. But the main reason for the rewrite was to create a highly authoritarian management and governance structure--found in section 4.1 of the agreement--that would endow one person alone with the absolute power to unilaterally hire and fire partners and other employees and to unilaterally set annual compensation. In investment banking, as in most businesses, there is no more absolute power over employees than the authority to set their compensation and determine if they will still have a job.
    The December 31, 1938, partnership agreement became the firm's Rosetta stone, and the "partner under section 4.1" became the firm's absolute monarch. As of the new year, 1939, Andre Meyer was not only the creator of the concept of Lazard's "partner under section 4.1," he was that partner. "He wanted the power of the firm in New York in granite," Michel said of the brilliant, mercurial, and impossible Andre Meyer.
    Although the rewriting of the partnership agreement could not have been welcome news to Frank Altschul in New York, he did his best to ignore its implications. Instead, in the following stressful years of World War II, he performed for both Andre and Pierre David-Weill--and their families--any number of the most selfless acts of partnership, only to be betrayed by them in return. Regardless of the help he would later provide, it was clear with the new partnership agreement that considerable tension had developed in the relationship between Andre and Altschul.
    "I suppose by now it will have occurred to you that your tone on the telephone this morning was highly offensive," Altschul wrote to Andre in August 1939. The two had been speaking and cabling about Andre's involvement in the just-announced bankruptcy of Mendelssohn & Company, a small but well-regarded Berlin-based investment bank. Dr. Fritz Mannheimer, a friend of Andre's and one of the leading financiers and art collectors of his day, ran Mendelssohn & Company from a branch in Amsterdam. Virulently anti-Nazi, Mannheimer, a Jew, had fled his home in Stuttgart, Germany, for obvious reasons and reestablished the bank in Amsterdam. On June 1, 1939, at his chateau just outside Paris, Mannheimer married Jane Pinto Reiss, another friend of Andre's.
    On his wedding day, the 250-pound Mannheimer suffered a heart attack. Eight weeks later, on August 9, he suffered another heart attack, and died at his chateau after he discovered his bank was insolvent (although there remained the serious suspicion he committed suicide by gunshot). Eventually, it came out that Fritz Mannheimer had borrowed heavily from his own bank to buy his extraordinary art collection, which included works by Vermeer, Rembrandt, and Fragonard. When he died, the loans could not be repaid, and the bank failed.
    A week after Mannheimer's death, Altschul wanted to determine the extent of Andre's personal involvement in the German banker's financial distress. "I dislike hearing from newspapers and from others that you have $1,000,000 unsecured credit, and I still cannot make