Florida's Sunday Editorials: Time to take a hard look at Jeb's role in FL investment fund debacle

[seafan]

From today's Palm Beach Post:


December 23, 2007

Consider this timeline, put together from reporting by Bloomberg News Service:

# Until January 2007, Jeb Bush, as governor, is one of three trustees of the State Board of Administration. The SBA administers $180 billion in Florida assets, including the Local Government Investment Pool.

# In February, out of office, Mr. Bush forms Jeb Bush & Associates.

# In June, the Lehman Brothers investment firm hires Jeb Bush & Associates as consultants.

# In July and August, Lehman Brothers sells the Florida pool $842 million in mortgage-backed debt. At the time, the SBA's executive director is Coleman Stipanovich. Promoted to the job in 2002 by Gov. Bush and the other SBA trustees, Mr. Stipanovich is the brother of Jeb Bush's former campaign manager.

# In November 2007, local governments and school districts that kept their short-term cash in the supposedly low-risk investment pool find out that the investments sold by Lehman Brothers and other brokerages have gone bad and rush to withdraw $12 billion, nearly half the pool's assets.

# In December 2007, after the state temporarily freezes accounts to stop the run on the state pool, Mr. Stipanovich resigns.

# In December 2007, after the Lehman Brothers link to Florida is reported, the former governor sends an "emphatic" denial of wrongdoing to The St. Petersburg Times. A Lehman Brothers spokeswoman insists that "there's no link between Bush and Lehman's sale of debt to Florida."

Of course, the timeline doesn't prove a link. But like so many other timelines involving Bush brothers and business deals - think Neil Bush and Silverado, George W. Bush and the Texas Rangers, Jeb Bush and foreign sales of water pumps - the timelines feature Bushes in business deals that have more to do with political connections than real business acumen.

The role of Jeb Bush and political crony Stipanovich in the Lehman Brothers deal is just one issue for the state to investigate. Another is the extent to which Lehman Brothers knowingly took advantage of what one expert called "less-sophisticated investors" to dump subprime-tainted securities. If there is grounds for a lawsuit, Florida should file it.

.....

From today's St. Petersburg Times:


December 23, 2007

The more Floridians learn about the near collapse of the state's local government investment pool, the more urgent the need becomes for a thorough investigation. The state was too easily convinced by Lehman Brothers, one of the biggest players on Wall Street, to expose itself to subprime-tainted debt. Former Gov. Jeb Bush has even been drawn into the controversy, according to an expose by Bloomberg News, and he has some explaining to do beyond a terse e-mail denying any involvement.

.....

When Coleman Stipanovich, then the state's investment director, learned that the securities sold by Lehman and others weren't as safe as advertised, he sought advice from the least objective source available ... Lehman. He should have gone to the trustees and the pool's depositors - local governments and school boards that were counting on return of their money - and negotiated an orderly recovery process. ..... Stipanovich abruptly resigned, but the possible influence by Bush on the investment decisions still clouds the matter. As governor, Bush helped Stipanovich get his job. He formed a new business, Jeb Bush & Associates, after he left office and was hired by Lehman as a consultant in June. A month after that, Lehman began selling Florida the shaky securities.

Did Bush play any role in those investments? "The answer to your question is an emphatic no," Bush said in an e-mail message to the St. Petersburg Times. But Floridians and Gov. Charlie Crist should not take that denial at face value. Too much money and credibility are at stake. State officials should review all of the records, including any contacts with Stipanovich during that time, to determine what really happened.

.....

First, when it names a replacement for Stipanovich, it needs to hire a competent financial professional rather than a politically connected Tallahassee insider. While Stipanovich had some experience at brokerage firms before coming to the state, his educational training was in criminal justice. More to the point, he is the brother of J.M. "Mac" Stipanovich, a Republican power broker who helped direct Bush's first gubernatorial campaign.

.....

Jeb emails St. Pete Times; denies role in FL SBA meltdown, December 19, 2007





Yeah, as throughout his quarter century of shady business dealings, Jeb's just 'a victim of circumstance'.



(bold type added)

[The Backlash Cometh]

1. Stealing in plain sight.

[Richard Steele]

2. The B*shes: too busy stealing to govern. nm

[flashl]

3. K&R

[babylonsister]

4. This seems like it's something that would never be uttered by

FL newspapers. Wasn't Jeb their savior? The bloom is off the rose, and I'm glad to see people starting to ask questions.

[Sancho]

5. The acorn doesn't fall far from the tree...

The Bush family legacy is one of cheating the public. I'm still amazed that they get away with it...

[onehandle]

6. Good. Keep the Bush crooks in the spotlight. nt

[tgnyc]

7. Don't forget Enron:

Florida pumped tens of millions into that turkey after it had started cratering.

[seemslikeadream]

8. Crime Family

[geomon666]

9. Where ever there is corruption you will find a Bush.

Malloy has it right. This is a damn crime family.

[malaise]

10. I'd say it the other way

Wherever there is a Bush there is corruption