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DNC Chair Caught in Global Crossing
JW Investigates McCauliffe’s Link to Bankrupt Company
When Enron filed for bankruptcy, the largest in our nation’s history, Clinton crony Terry McAuliffe was among the first to cast his verbal stones. The DNC Chairman criticized greedy Enron executives for hurting the “small people,” calling for a full investigation. He lashed out at the wealthy special interests. He questioned the company’s ties to the Bush Administration. Armed with what he perceived to be a winning campaign issue against Republicans and their popular president, McAuliffe was relentless. Ironically, the Bush Administration’s cozy ties with Enron are subject to JW’s investigation.
So why has the Democratic Party’s most spotlight hungry mouthpiece faded from view? Two words. Global Crossing.
While the SEC and FBI begin to probe the questionable accounting practices of telecommunications giant Global Crossing, Ltd., which went belly up on January 28, Judicial Watch has launched a full investigation into Terry McAuliffe’s ties to the company.
In what is an unprecedented case of political profiteering, McAuliffe turned a $100,000 initial investment in the company into $18 million in less than a year and a half—a nifty 18,000% profit. According to the New York Times, McAuliffe made millions more trading the stock and options after the company went public in 1998.
Here is how the stock sold, to the dumb public, after McAuliffe bought low and sold before the corruption was revealed!
shady ties to the company go beyond his questionable
investment windfall. According to the press reports,
McAuliff also did “political work” for Global Crossing
CEO Gary Winnick, working out of an office in downtown
Washington owned by Winnick. On one occasion, McAuliffe
set up a golf outing for Winnick and then-President
Clinton. Winnick would later give a million dollars to
Clinton’s presidential library. The question is: what did
he and Global Crossing receive in return?
Crossing the Line
Shortly after Winnick’s generous contribution to Clinton’s legacy building library, Global Crossing was awarded a $400 million contract by the Pentagon.
Due to irregularities in the bidding process, brought to light by separate complaints filed by those who had lost out on the contract, the Bush Administration cancelled the deal, precipitating a free fall of Global’s stock price.
Like Enron, Global Crossing had artificially inflated its stock price while executives engaged in massive stock selling in the year leading up to filing for bankruptcy. While Global brass made billions, employees lost their life’s savings as their 401(k) retirement plans were casualties in the Chapter 11 filing.
While Enron was an equal opportunity influence peddler, Global Crossing’s political leanings are noticeably one-sided. The company was the fifth largest corporate donor to the Democratic Party during the 2000 election cycle, but moved swiftly into first place this year. So far, Global has donated $350,000 to the Democratic Party for the 2002 campaign, and none to the GOP.
Further, Winnick, through his Pacific Capital Group, donated all of his 2000 campaign budget of $250,000 to the Democratic Party, and none to the GOP.
Global Crossing reportedly sponsored a fundraising dinner for Senate Majority Leader and Democrat Tom Daschle and gave thousands to Henry Waxman during the last election cycle. The company paid former Justice Department lawyer and Janet Reno assistant Anne Bingaman $2.5 million for her lobbying efforts. And former Defense Secretary William Cohen, a Republican, the man at the helm when Global Crossing was awarded a lucrative Pentagon contract, was named a Director of Global Crossing in an April 2001 company press release. He reportedly got a $500,000 consulting fee from the company as well.
Finally, Judicial Watch has filed Freedom of Information Act requests with various government agencies regarding Global Crossing and is contemplating shareholder lawsuits as well.
“Terry McAullife’s astonishing profit reeks of potential insider trading, especially given his role in selling government favors for campaign contributions during the Clinton Administration,” said JW Chairman Larry Klayman.
XXXXX DRUDGE REPORT XXXXX MON JAN 28 2002 20:21:38 ET XXXXX
GLOBAL CROSSING BANKRUPTCY: GOP INSIDERS QUESTION DNC CHAIRMAN MCAULIFFE PROFIT, TURNED $100,000 INTO $18,000,000
ENRON-stung GOPers are discreetly eyeing the collapse of GLOBAL CROSSING [which on Monday became the 4th largest bankruptcy in history] and its Chairman Gary Winnick, a top Democrat donor who helped DNC head Terry McAuliffe turn a $100,000 stock investment -- into $18,000,000!
McAuliffe arranged for Winnick to play golf with President Clinton in 1999 after his cash windfall. Winnick then gave a million dollars to help build Clinton's presidential library.
A top White House source noted to the DRUDGE REPORT, with irony, the direct McAuliffe connection with Winnick and GLOBAL CROSSING.
"McAuliffe is a guy who made millions and millions and millions off this GLOBAL CROSSING stock? And the company goes bankrupt. And he has the gonads to criticize anyone on ENRON!" blasted the Bush insider who asked not to be identified.
"What did Winnick get for his money? Let's have congressional hearings! Stockholders should demand it! Will Mr. Clinton give back the money?"
McAuliffe, in his role as chairman of the Democratic National Committee, has been a vocal opponent of the ENRON collapse, telling CNN this weekend: "The people out there who are hurt the most are the small people, and once again the wealthy special interests got to take their money off the table, and that's what we need to investigate."
"The Bush administration is running fiscal policy the way folks at ENRON ran their company," McAuliffe has said.
But with shares of GLOBAL CROSSING closing at just 30 cents on Monday, and trading suspended after the Chapter 11 deal was announced, McAuliffe faded from view.
For McAuliffe, GLOBAL CROSSING turned out to be a bonanza. The stock had soared in the late 90s, when Winnick once bragged that he was the "richest man in Los Angeles." McAuliffe operated out of an office in downtown Washington that belonged to Winnick -- to help the mogul "work on deals."
McAuliffe told the NYT TIMES's Jeff Gerth in late '99 that his initial $100,000 investment grew to be worth about $18 million, and he made millions more trading GLOBAL's stock and options after it went public in '98.
Top GOP insiders were also gloating over GLOBAL CROSSING ties to other ENRON obsessives.
A major fundraising dinner for Senator Tom Daschle was bought and paid for by GLOBAL CROSSING.
Winnick gave thousands of dollars to top ENRON cop Rep. Henry Waxman during the last election, according to public records.
But as everything blurs, and blurs again in the bankruptcy cycles of the fresh century, and in a twist that will ensure GOP operatives do not ride GLOBAL CROSSING all the way into shore: Former President George Bush once made a smart move by accepting stock in a start-up company instead of his usual speaking fee when he addressed an audience in Tokyo.
Bush agreed to take shares in -- GLOBAL CROSSING LTD. in lieu of an $ 80,000 fee!
McAuliffe's Winnick reportedly suggested that Bush take his fee in stock instead of cash, and Bush agreed. The Bush stock, at its high, was worth over $ 14 million.
It is not known if he is still holding the scraps.
* * * * *
An e-mail to the DRUDGE REPORT on Monday night:
I am a consistent reader of the Drudge Report and listen to your nationwide radio program.
I am a shareholder of Global Crossing and I believe there is something terribly wrong with the whole scenario - Gary Winnick's huge profits Vs calming public statements to Shareholders, the yearly turnover of CEO's, Gary Winnick's cronies making up the BOD and that BOD not protecting Shareholders, the public statements of the most recent CEO, John Legere, Vs the bankruptcy announcement on Monday, the deal with the Chinese buying the Company for pennies - 750 million for a 22.4 BILLION dollar company - (Will our government and other major firms use this service owned by a Chinese Co.?), Andersen's involvement -- the confusing balance sheets — the lending institutions being duped, and the obvious profiting and involvement of political figures.
I hope your considerable influence will affect the bankruptcy judge, Robert E. Gerber, to deny the petition.
Sir, I can assure you that every employee and shareholder appreciates your involvement -- the little guy has suffered enough.
xxx xx xxx
Filed By Matt Drudge
Reports are moved when circumstances warrant
http://www.drudgereport.com for updates
(c)DRUDGE REPORT 2002
Not for reproduction without permission of the author