Cantor Fitzgerald CEO and the aftermath of 9/11

No company with offices in the World Trade Center was as devastated as Cantor Fitzgerald, the nation's leading bond brokerage firm, which occupied floors 101 to 105 atop the North Tower.

After the first al Qaeda-hijacked plane struck, all of the firm's 658 employees who were in the office that morning were trapped. None made it out alive.

The firm's CEO, Howard Lutnick, who was not in the office, dedicated his life over the past decade to rebuilding his business with one mission in mind: Helping those families, which represented nearly 70 percent of his workforce.

Lutnick not only lost many of his colleagues: Among the dead were Lutnick's brother Gary, as well as his best friend Doug.

CBS News senior business correspondent Anthony Mason sat down with Lutnick to discuss his journey of resilience.

ANTHONY MASON: You're not someone who's put sort of September 11th behind you and not thought about it for ten years. It's been present in everything you've done. What does this anniversary represent, to you?

HOWARD LUTNICK: Well, enough time has gone by that the friends and family who suffered that great loss have really come to terms with it. And they can talk about their loved ones, remember them, and smile. It still hurts parents more than anyone else, because you lose a child there's just nothing can that can mend that broken heart. But our community is so tight together. We can remember our friends really positively. And that's a really nice thing.

MASON: After all you've been through over the past ten years, how do you feel at this point?

LUTNICK: Well, I'm most proud of the community that we've built together. I mean we have 20 kids of people who died working here. I mean, can you imagine how wonderful that is as a compliment to the firm? So a great community, great employees, worked hard together to build that relationship, and great families and their connection to us.

MASON: The night of September 11th, ten years ago, you not only had lost over 600 employees, you thought you probably lost your whole business, too, right?

LUTNICK: Of course.

MASON: You're still here, and you're bigger and stronger than ever. How did that happen?

LUTNICK: We had a conference call, and we basically said we have two choices: We can shut the firm, go to our friends' funerals. You have to remember, 700 people means 20 funerals in a day, which is not possible to attend, for 35 straight days. It's just inconceivable. Or, we'd have to work harder than we've ever worked in our whole lives. And while everyone on the phone had a different reason, ultimately it was unanimous. We decided to work harder than we've ever worked before but for one purpose, which was to take care of our friends' families.

MASON: Initially you were hemorrhaging money, at that point. Weren't you?

LUTNICK: A million dollars a day we were losing. We paid the employees through the 15th. So for four days we paid the employees who had died. And, of course, we had no revenues. So, no revenues coming in, lots of expenses going out. It's simple math, it doesn't take very long.

MASON: You stopped paychecks for the employees who had died, and you got a lot of grief for that at first.

LUTNICK: There were people hadn't really thought it through. Compared us to other firms, saying, 'Gee, other firms were paying someone's salary who'd died for another month or so. Why can't you do that?' And the answer was sort of simple math, which is, if you lose three quarters of your staff, and all of the people who produce the revenue, you can't pay people with revenue you don't have. So, while it was a tough decision, it was the only decision. We committed to something quite different. We said, 'These families are part of us, and we're gonna give them 25% of our profits, and we're going to rebuild this company in order to take care of them. And we're gonna pay for the health care for ten years straight, so that they don't have to worry about that. We'll be there for them. And that's what we did.

MASON: The estimates I've seen is you paid out something in the order of $180 million?

LUTNICK: Right. We made two payments. We made a $45 million payment in October of 2001. We figured out how much money did the firm need to survive. And then whatever else was left, we paid out in one check. After that, we gave 25% of our profits of everything we made thereafter. And that we split per person. So 658 people, exactly, equal because everybody's equal. Some people make more, some people make less, but everybody's life is infinitely perfect. And if you want to know how valuable, just ask their mother.

MASON: What were you doing that morning, that you weren't in the building?

LUTNICK: September 11th was my son Kyle's first day of kindergarten. And he's 15 now and walks with attitude. He's 5'8'', taller than my wife. At the time it was his first day of kindergarten. So my wife and I took him to that first day of school. And that was two minutes before the first plane hit.

MASON: I think a lot of people would have gone into shock after that. You didn't seem to have that response.

LUTNICK: I figured I would have to compartmentalize. I would start crying, and then I'd pull myself together, and say, 'Okay, we have a meeting with the bank.' And I need the company to survive to take care of these people. So there's nothing sad about meeting with the bank. 'So let's focus on meeting with the bank.' And so I would cry, and I would stop crying.

MASON: It is impossible to process that much loss, and you can't process it in one big lump. It came to you, sort of one person at a time?

LUTNICK: One person at a time. You'd see their face, and they were killed. So, it was sort of you'd walk around, and be hit in the head with a brick, sort of all the time. We really had just a rollercoaster of emotion. Just an absolute rollercoaster, because if something made me happy, you know, it was as if someone had come back to life.

MASON: When you got a chance to finally talk to your kids, what did you say?

LUTNICK: My children knew that I had to help my friends' families. And that was the story that we were telling them, that something terrible had happened at daddy's work. And that all, you know, Uncle Gary, Uncle Doug, all of our friends, so many people that they know, they had been killed, and I needed to help their families.

And so, they come to the memorial. My son Kyle came to many years' memorials, and he would stand next to me and just shake people's hands and hug them, because he felt that would help them. That was our mission, and I think my kids understand that remains our mission.

MASON: You went to a lot of funerals.

LUTNICK: I did. I know the Eucharist by heart. I know Roman Catholic, Jewish, Presbyterian, Episcopal. I knew them all them all by heart. In a Catholic service, I would get on the communion line. And as we got up to the front, I would step out of the communion line, go up to the family, say hello, and then head out of the church, get in the car, and head to the next one. My best friend's brother-in-law - his memorial service was at the exact same moment in Westchester as my roommate in college's brother in Manhattan. So, my wife went to one, and I went to the other. It is the saddest thing to not be able to attend your friend's funeral. It is just pulverizing.

MASON: How did you not let the grief overwhelm you?

LUTNICK: I cried all the time. It wasn't as if the grief didn't overwhelm me. It would only last for five minutes. And then, I'd sort of say, 'Oh, look you've got pull yourself together.' And I'd be wiping my eyes all the time. I'd just say, 'You gotta pull yourself together, 'cause the next topic isn't sad.' You know, talking with a banker is not sad. Trying to figure out how we're going to process securities trades that we did on September 10th, really, it's not a sad topic. It's complex. I described my business life after 9/11 of it was, like, playing chess, where the board is moving, and hundreds of other people's hands are reaching in and moving the pieces. And it's your turn.

You know, every day, I would say, for weeks, the worst business thing that ever happened to me in my life, happened. Dow Jones cancelled our contract. Used 9/11 to try to get out of their obligations to us. Outrageous. They ended up settling the case, paying us over $200 million. And then, what did I say? I said, 'Didn't kill anybody today.' So that was it. Not that bad. Not that bad.

MASON: I was struck by the fact that you were orphaned at 18. How do you think that affected the way you responded to the families in this?

LUTNICK: I lost my mother when I was a junior in high school. And then my first day of Haverford College, my dad was killed. He went in for his first chemotherapy shot, and the nurse made a terrible mistake. Gave him 100 times the dosage, and killed him right then and there.

MASON: Oh, God.

LUTNICK: So, I knew what hell felt like. You know, you lose one parent, it's bad. The second parent and unexpectedly - September 12th 1979, and September 11th, 2001 - they smelled the same. I had a rally of 21 years, 364 days and bam. Right back in the bottom of hell. But I knew that things would get better, 'cause I'd been to hell and come out. When people say, 'Time heals all wounds,' they're right. But when they're saying it, they're saying it at the wrong time. Right? That's what people forget. They say, 'Oh, time will heal it.' Time won't heal it on Thursday. Sure, three years from now, say it. People always get that wrong.

MASON: When you fulfilled that pledge of paying 25 percent of your profits over five years, how did you feel?

LUTNICK: I felt I had built a great relationship with the families, and that they could count on us and rely on us. There was a promise that we'd take care of their health insurance, the promise that we'd help them with the victim's compensation fund and Ken Feinberg, which was so complex and arcane. But, we did a report for each family to help them take care of themselves.

MASON: Basically, you rebuilt this company for them.

LUTNICK: I did. Cantor Fitzgerald stands because we needed to help them. The heroic nature of my employees and the people who joined us to help us, who knew they were going to make less. It was on their shoulders. We survived because we stood on their shoulders.

MASON: And you're bigger now than ever. You have more employees than you did then, yes?

LUTNICK: Sure. We had 960 New York employees then. And we have just over 1,500 in New York now.

MASON: That's quite an achievement.

LUTNICK: Well, to take care of someone and to grow your business, you have to hire. Someone would say, 'Well, why wouldn't you move out of New York?' It a simple reason: New York has talented people, lots and lots and lots of talented people. I mean, if you want to build a business, you know, New York's a great place to build a business. Huge amounts of talented people concentrated together. We were able to hire lots of them by, and it worked for us.

MASON: Does that day come back to you now in any way ever? Or is it all sort of blurred in some history?

LUTNICK: September 11th is a hard line between the life had before and the life I have now. If I think about my company and think about it from September 10th, I think 'How did we get here?' Given all the cards and tools that we had then, we should be much better off than we are today. And if I think about it from September 12th, I think it's such a miracle, I can't imagine that I'm sitting here talking to you.

MASON: Some people talk about survivor's guilt. Particularly with September 11th, 'I'm here, these people aren't.' Have you had that?

LUTNICK: I have absolutely had survivor's guilt.

LUTNICK: You know, I was dropping my son off at school. My best friend Doug was going to take off the next day for his son's school. So he's dead. And I'm here. Of course, you're gonna feel that way. You have no choice.

MASON: What was the key moment in the comeback of the company?

LUTNICK: One of our competitors, ICAP, which has this company called BrokerTec, which brokers government bonds, was anxious to take over our business of government securities. They wanted to open the market on Thursday morning, the 13th of September, and they opened. So, number one, we had to open with them, because we were the market for U.S. treasuries. And if we didn't open, the market would just move away. And move to them.

So, we had to open on the 13th. Then, the New York Stock Exchange and equities opened on the 17th, so we had to open on the 17th. And then, we had to process and pay for all the business that we did on the 18th. And the banks agreed - JP Morgan was fantastic - to allow us to do our business and open, provided that we were able to always lower the amount we were borrowing from them. They were lending us on September 12th $75 billion, because all that we had paid for and bought on the 10th, we didn't know who to give it to on the 11th, because all our systems went down. Our computers were gone, our people were down, our backup computers went out. So, the biggest moment for us was on September the 19th, when after the day of processing, I had just gone to my friend Joe Shea's funeral and his brother Danny. The two of them were killed and they had a funeral, which tore my heart out. And then I was informed by the bank that we had processed all those transactions. And our loan was only $58 billion. And the company would survive. And therefore, we could tell the families we were gonna take care of them.

MASON: Some people ended up moving back down into that [Lower Manhattan] neighborhood. Did you purposely not want to go back there?

LUTNICK: I wanted to be on a low floor. That's why right now, we're having this interview on the third floor of our building. And I preferred to have an office uptown. However, we do have an office downtown. We had only 302 people not get killed, and have about 100 left who still work here.

We have 1,400 new people, 500 people downtown. I'd prefer not to have an office directly on the World Trade Center site. That would be too tough for me. But downtown is not tough at all. I think downtown is a great place to work.

MASON: Is it hard for you to go back to that site?

LUTNICK: I have to breathe deep each time and steer myself forward. I'm on the board of the National September 11 Memorial Museum, and we had a board meeting, and I hadn't realized it was at the site. So, I was just in a car, going downtown, and he pulls up to the site. I said, 'Whoa, what are we doing here?' He said, 'Well, this is where the board meeting is.' And I just, I hadn't prepared myself. I didn't feel good.

When I go to the site, I need to think about it. I need to be ready for it, because I see their faces. I see my friend's faces. And the best part about September 11th now, ten years later, is I love seeing their faces.

MASON: You talked about the motivation of helping the families. But once you'd done that, what motivated you?

LUTNICK: First we start by trying to take care of the families of those we lost. Now, you have all those employees who helped you take care of those families. So, you have to say thank you to them.

They've made less as partners than they would have. They gave up 25 percent of what they would have made. So, we took BGC public, so that we could reward our employees in April of '08. Now we have all those new employees who helped us take care of the old employees, who took care of the families. And so, probably Cantor Fitzgerald will go public for that same reason, so that I can take care of my employees, who have helped me take care of the people I needed to take care of.

MASON: What will you be doing on September 11th?

LUTNICK: I'm going to go downtown and see the National September 11 Museum and memorial. So, I can rub my friends' names, which I think is going to be absolutely beautiful. But I'm going to go after the politicians leave. I'm not going to sit and listen to all of that kind of pomp and circumstance. That's just not for me. Then, we have a memorial service in Central Park, where we have our employees and our families get together, as we do every year. We read their names, and we show their pictures. I ask family members to speak, and they always ask me, 'What should I speak about, Howard?' I say, 'Bring him back to life. Tell us about him.' They say, 'But that seems selfish.' And I'd say, 'Well, how were the speakers last year?' They said, 'They were great.' I say, 'That's what I told them to do, because when you're speaking directly to other people's hearts, it's beautiful.'

Then on September 12th - usually on September 11th, if it's a business day - we hold charity day. We will donate, not all our profits, but all revenues that we do. Every penny of revenue that the company does around the world globally, we will donate to charities. We have about 75 charities. Wounded Warriors would be one. Boomer Esiason's cystic fibrosis charity. Lots of children's charities, cancer charities. And all of our employees give up their pay.

MASON: Wow.

LUTNICK: Last year, we did $12 million.

MASON: All the people we talked about your company losing, we didn't talk about your brother. I'm sure that was the most difficult.

LUTNICK: I kept my brother for myself. I waited a long time for his memorial service, until everyone else's was done. I didn't really name things for him until we had taken care of everybody else.

I had such a great relationship with him, there were not things left unsaid. He knew how much I loved him and he's mine. And he'll be forever mine.

MASON: Thank you, Howard.