Assembly Speaker Sheldon Silver has spun the 9/11 lawsuits into gold.
Ground Zero workers are on the hook to pay steep interest on money their lawyers borrowed from a group of investors that include Silver and his law partners, The Post has learned.
Silver’s partners at the Weitz & Luxenberg law firm are top board members of a business that quietly loaned money at 18 percent a year to the law firm representing some 9,800 Ground Zero workers with toxic-illness suits against the city.
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Silver personally invested an undisclosed sum — but at least $50,000 — in Counsel Financial Services, a Buffalo-based attorney-funding company that gives four-year loans and lines of credit up to $10 million to law firms with cases expected to hit the jackpot.
Sources told The Post that Counsel Financial loaned money to Paul Napoli and Marc Bern, lead attorneys suing the city on behalf of cops, firefighters, hardhats and other workers and volunteers who blame illnesses on the toxic World Trade Center rubble.
Silver’s office has previously described him as a “passive investor” in Counsel Financial.
“He doesn’t know where the money goes,” Silver spokeswoman Sisa Moyo said when asked to comment on Counsel Financial’s connection to the law firm battling New York City in the 9/11 cases.
Silver’s Assembly district covers much of lower Manhattan, including Ground Zero, and the speaker is arguably the most powerful Democrat in the state.
A source familiar with the 9/11 litigation said Worby Groner Edelman & Napoli Bern, the law partnership representing the 9/11 workers, “had to lay out $20 million to $30 million” to fight the cases for six years against City Hall, which at first refused to pay a dime to ailing workers.
The firm “borrowed most of it,” the source said, adding that the lawyers would have to repay the loans themselves if they lost the cases. “They took the risk.”
Napoli said his firm took out various loans “at the best rates we could find,” but would not answer further questions.
But now, lawyers are trying to pass on the interest costs to their 9/11 clients. Manhattan federal Judge Alvin Hellerstein has called a hearing next week to investigate whether the lawyers have overcharged their clients.
Out of the proposed maximum $712 million settlement, the lawyers are expected to collect nearly $200 million in fees and expenses — including “repayment of interest expenses.”
Workers said they had no knowledge of the loans and no idea they would be socked with the interest charges. Some were stunned when they opened their settlement-proposal letters last month to learn their awards would be slashed by hundreds to thousands each.
One first responder, told of Silver’s connection to the high-interest loans, was disgusted.
“He’s making a profit off the sick and the dead in the world’s biggest tragedy,” he said. “These guys are just capitalizing off the guys who really need help.”
Silver, on his latest financial disclosure form, says his 2007 investment with Counsel Financial was due to be repaid in March this year.
Sources said the 9/11 lawyers would have already repaid the money borrowed from Counsel Financial.
Joseph DiNardo, founder and adviser to the board of Counsel Financial, refused to comment on which firms it has funded.
“It’s our policy and our agreement with all of our borrowers that we do not disclose who our borrowers are or comment on their litigation,” DiNardo said.
DiNardo said Counsel Financial does not earmark its loans for any specific lawsuits, but leaves it up to borrowers to spend the money on whatever they choose, from office overhead to trial expenses.
Counsel Financial’s profit margin is “close to 4 or 5 percent,” DiNardo said.
Silver’s law partners, Perry Weitz and Arthur Luxenberg, are chairman and vice chairman of Counsel Financial. The personal-injury lawyers pay Silver a retainer to keep him at Weitz & Luxenberg, although Silver’s “of counsel” role at the firm is unclear.
Firms like Counsel Financial have sprung up in recent years as big-money lawsuits drag on without any pay out for years. Most banks do not gamble on loans to law firms based on future winnings.
Another leading law firm representing 689 Ground Zero firefighters and workers has told Hellerstein it did not take loans for the cases and would not charge any interest to clients.
A good-government group blasted public servants who would profit from a settlement drawn from a taxpayer-paid $1 billion fund to pay sick and injured 9/11 workers.
“It’s highly questionable for the speaker to be investing in a company whose interest charges to the lawyers result in reduced federal taxpayer support for ill 9/11 workers,” said Dick Dadey, director of Citizens Union.
He added, “For the lawyers to add interest to their generous take is particularly heinous when this federal money is intended for those who fell ill helping the country on 9/11.”
* Assembly Speaker Sheldon Silver invests at least $50,000 in Counsel Financial Services.
* Silver’s law partners, Perry Weitz and Arthur Luxenberg, chairman and vice chairman of Counsel Financial, also invest in the firm.
* Counsel Financial lends money at 18 percent interest per year to fund cases brought by personal-injury lawyers Paul Napoli and Marc Bern.
* Napoli and Bern borrow money from various sources to help cover $20 million to $30 million in litigation costs for 10,000 Ground Zero workers suing the city.
* Napoli and Bern pass on the interest charges to their clients — 9/11 responders affected by toxic dust — taking a hefty cut from their proposed settlement awards.