Giuliani Denial Over Role to Rig Presidential Elections Doesn't Pass Smell Test

Washington, DC - Rudy Giuliani attends fundraisers in New Jersey today amid growing questions about his role in the ballot initiative to rig the Electoral College in California for the presidential election. Despite his denials, Giuliani has yet to address the fact that his top fundraiser admitted to being the sole financial backer of the initiative.

On Friday, New York "vulture fund" billionaire Paul Singer acknowledged that he made the sole donation of $175,000 to "Take Initiative America," a currently defunct shadowy front group that financed the initiative. Singer also is the founder of Elliott Associates, whose employees have donated almost $230,000 to the Giuliani campaign, making it the top source of donations. [Los Angeles Times, 10/1/07, New York Daily News, 9/28/07]

Before resigning late last week, Giuliani donor Charles A. Hurth III, was the registered agent for the Missouri-based "Take Initiative America" group. Hurth, who had no connections to California politics, was also behind a GOP-funded group called "Choices for America," which tried to put Ralph Nader on the ballot in 2004 to help Bush win the presidency. [San Francisco Chronicle, 9/27/07]

Giuliani's trip to New Jersey comes as the Californians for Fair Election Reform is filing a complaint with the Federal Election Commission and the Justice Department, asking them to investigate Rudy's involvement in directing money to the California ballot initiative.

In light of these revelations, DNC Chairman Howard Dean issued the following statement.

"Why wasn't Paul Singer's involvement in this dirty trick aimed at stealing the White House previously disclosed? Given his role in the Giuliani campaign, voters deserve to know the truth about Rudy's involvement in and knowledge about this shameful effort to disenfranchise voters."

GIULIANI'S TOP DONOR, TREASURER RUNS "BIGGEST" OF "PREDATORY INVESTOR" "VULTURE FUNDS"

"Vulture Funds" Are "Predatory Investors." 'Vulture funds' are "predatory investors who buy a nation's debt for pennies on the dollar and then sue to win repayment of the full value of the initial debt." [Associated Press, 5/22/07]

Singer's Firm is the "Biggest" Vulture Fund. Among vulture funds, "the biggest is Elliott Associates, a hedge fund based in the U.S. and owned by Paul Singer, a billionaire businessman." [The Guardian (London), 3/10/2007]

Elliott Associates Founder and Chairman is Giuliani's Regional Finance Chair, Major Policy Advisor. Giuliani named Paul Singer, the founder of the Elliott group of companies to be his northeast regional finance chair and considers him a "major policy adviser" according to the American Prospect. [The American Prospect, July-August 2007; Washington Post, 4/18/07]

Elliot Asset Management Was Paid $175,648.39 For Travel By Giuliani's Campaign During The Second Quarter. On 15 occasions during the second quarter, the Giuliani campaign paid Elliot Asset Management, an arm of Paul Singer's company, for "travel," understood to be for use of their corporate jet. This more then seven times the amount to the next highest corporate jet provider, Wilson Holdings. [Giuliani Presidential Committee, FEC Report, 2007 Second Quarter, Schedule B, Filed 7/13/07] (full list of transactions attached)

Singer, Elliott Management Is Top Source Of Giuliani Donations Through Early 2007. According to the Center for Responsive Politics employees of Elliott Management and their dependents have contributed at least $221,300 to Giuliani's campaign through the first quarter of 2007. the most of any company. In the second quarter of 2007, another seven individuals associated with Elliott Associates or Elliott Management contributed another $4550, keeping it at or near the top of the list. [Capitaleye.org, http://www.capitaleye.org/inside.asp?ID=258, 4/16/07; Giuliani Presidential Committee, FEC Report, 2007 Second Quarter, Schedule A, Filed 7/13/07]

SINGER AGRESSIVELY PURSUED DEBT IN PERU, CONGO FOR HUGE PROFIT

Elliott Sued And Won $58 Million from Peru, Almost a 400% Profit. "On one occasion, Elliott spent $11.8m on 'distressed' Peruvian debt in 1996 and four years later forced Peru to pay almost $58m to redeem it." [The Guardian (London) Final Edition, 3/10/2007]

Elliott Spearheaded 'Vulture Fund' Activity With "Creative" Lawsuit. Before Belgian laws were changed to prevent creditors from such activity, in 2000 Elliott Associates sued Peru in a Brussels court for tens of millions worth of bonds that cost it only $11.8 million. Elliott's "creative" legal move paved the way for future creditors to seize foreign debt, stake a "holdout" position, and sue for the full worth of the foreign bonds. This was precedent-setting, "the ruling suddenly gave holdouts the teeth to disrupt sovereign debt restructurings." According to the Financial Times, "That sent the sovereign bond world into a tizzy." [Financial Times, 2/18/2007; Michigan Law Review, 3/1/2006]

Elliott-Controlled Kensington International Pursuing $100 Million of Congo's Debt. "A Cayman Islands company that owns more than $100 million of Congo's sovereign debt and is controlled by Elliott Associates [is] a $6.5 billion New York City hedge fund. Kensington has been battling [Congo President Denis] Sassou-Nguesso and French bank BNP Paribas in federal court in the U.S., demanding payment of the debt. In March a judge rejected a motion to dismiss, allowing Kensington's RICO case to go forward… Kensington has already won four civil judgments in England in the same case, including a $56 million judgment in 2002 and separate judgments of $22 million, $19 million and $1.3 million in 2003." [Fortune International, Fortune Asia, 6/26/2006; Banking Wire 9/12/2006]

SINGER'S FIRM IS REGISTERED OFFSHORE

Key Parts Of Firm Are Based in Cayman Islands. Two arms of Elliott Associates, Elliot International and Kensington International, are based in the "tax havens" of the Cayman Islands, according to the firm's press releases and trade publications. [Elliot Associates release via BusinessWire, 6/4/2002; Banking Wire, 9/12/2006]

Vulture Funds Register in the Cayman Islands and British Virgin Islands To Maintain Secrecy. "Many vulture funds are registered in the Cayman Islands and British Virgin Islands….It is notoriously difficult to know how many funds there are because companies are often set up to pursue one case against a single country." [The Guardian (London) Final Edition, 3/10/2007]

SINGER, ELLIOT ASSOCIATES AND KENSINGTON UNDER FIRE FROM WORLD LEADERS

UK Prime Minister Gordon Brown: "I Deplore" Vulture Funds. Shortly before becoming Prime Minister, Brown, then the Chancellor, said "I deplore the activities of so-called vulture funds that seek to profit from debts owed by the poorest countries in the world. I am determined to limit the damage done by such funds." [The Mail on Sunday (London), 5/13/07]

Deputy Managing Director of IMF Opposed "Rogue Creditors", Elliot Associates. A past top official of the International Monetary Fund, First Deputy Managing Director Anne O. Krueger, gave a speech called 'A New Approach to Sovereign Debt Restructuring,' targeted at Elliot Associates. She called for the IMF to adopt a policy that would prevent firms like Elliot Associates from "disrupting negotiations," that would otherwise lead to amicable debt restructuring agreements between the two nations, by seeking repayment through national courts. [The Financial Times, 1/18/2002]

Congo President Furious with Elliott-Controlled Company. Congo President Denis "Sassou-Nguesso…[is] particularly furious at the hedge funds and other creditors that own hundreds of millions of dollars of his country's sovereign debt--bought at a steep discount after the Republic of Congo defaulted on its loans--and that are trying to collect by chasing down the government's assets all over the world. Bank accounts have been frozen, court judgments obtained, and oil shipments seized. [Sassou-Nguesso] calls the hedge funds 'vultures' that make their home in tax havens, don't disclose their ownership, and stand to make huge profits on their investment in Congo's debt." [Fortune International, 6/26/2006]

Financial Times: Peruvian Government was "Held To Ransom." "In Peru, the government was held to ransom by a so-called 'vulture fund', Elliott Associates, which bought up distressed debt during a restructuring and forced the Peruvian government to pay the full face value, with the threat of seizing other assets if it did not." [Financial Times, 11/29/01]

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Comments (1) «

I'd like to suggest that you maintain the distinction between vulture capitalists and predatory capitalists. The former feast on carrion--i.e. public and private corporations that have failed (fallen into bankruptcy) Predatory capitalists, on the other hand, aim to destroy public and private corporations, often by lending them more money than they can reasonable expect to repay, for the purpose of leveling the playing field--i.e. creating a monopoly situation for the "last man standing" in an industry. Providing dead meat for the vultures is just a side-line.

Humans have evolved the capacity to engage in fair trade and exchange to manage their surplus and acquire the variety of resources they need to thrive. Predators just take what they need (and more) without giving anything back and it's obvious that this behavior survives in the gene pool as a default for when a harsh environment makes it impossible to engage in trade.

What seems to have happened in the case of the capitalistic predators is that the accumulative behavior of the pack rat has been combined with the destructive practices of the hyena. An addition, unlike other predators, many humans seem inclined to direct these primitive behaviors against their own kind.

1

hannahsmith on October 2, 2007 at 07:53 AM

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