Raimondo’s Ties to Hedge Funds and Private Equity Draw More Fire
Thursday, July 12, 2018
Oaktree admitted no guilt, but agreed to pay a $100,000 civil fine to the federal government.
In 2011, Raimondo entered into an agreement with Oaktree to invest up to $20 million. According to now General Treasurer Seth Magaziner’s office, “As of 12/31/2017 they had drawn $17,150,000, distributed (already sent back) $6,352,967 with remaining assets valued at $20,411,973.”
Raimondo received two donations from Oaktree executives while she was General Treasurer. Her campaign reports she accepted one donation -- and then refunded it about five weeks later.
An earlier donation from another Oaktree executive was accepted and her campaign says it was below the threshold of an enforcement action by the SEC. Despite repeated requests for an answer, her campaign refuses to answer if Raimondo’s campaign will return the earlier check from the other Oaktree executive.
"In this case, the Treasurer believes it was appropriate for the SEC to levy the fine and also appropriate for then-Treasurer Raimondo to return the 2014 contribution. We have been assured that the penalty will be paid entirely by the manager [Oaktree], not the pension fund and we will continue to monitor for additional developments closely," said General Treasurer Seth Magaziner's office on Wednesday night.
Raimondo’s Democratic challenger Matt Brown criticized the Raimondo link to the private equity fund. “Does anyone believe this is the only time? Raimondo's relentless pay-to-play fundraisers with Wall Street and industries she's supposed to regulate have hurt people and hurt Rhode Island. It's outrageous, and part of a broken system of establishment insiders benefiting from office and using the system for personal political gain,” said Brown.
GOP candidate for governor Allan Fund also criticized Raimondo’s ties and related fundraising. “Last year, she was caught up in the Thornton Law Firm donation scandal. Now, Raimondo is named in a pay-to-play scheme occurring during the final weeks of the 2014 election," said Fung.
"Rhode Islanders intuitively know that donors in California, New York, and Chicago have no real altruistic interest in our state. This is pay-to-play Raimondo finally getting caught by the Feds," added Fung.
Over the past eight-plus years, Raimondo has raised more than $12 million. Much of the fundraising is from out-of-state donors and millions are tied to Wall Street interests.
For Raimondo, the SEC pay-to-play enforcement action comes just three days after GoLocal unveiled that as a result of another investment Raimondo made in a leading hedge fund, the Rhode Island retirement system may now be the proud part-owners of a top-tier professional soccer club in Italy — AC Milan.
The ownership interest in the soccer club is tied to a controversial investment decision she made in which she invested $70 million into hedge fund Elliott Management — run by Paul Singer. He was the seventh largest political donor in America in the 2016 election cycle — donating over $26 million to Republican candidates according to Open Secrets.
According to the Financial Times of London, “AC Milan, one of European football’s most successful clubs, is close to being taken over by Elliott Management, after its Chinese owner failed to repay debt owed to the US-based hedge fund. Li Yonghong, who acquired the Italian club last year, has failed to make a €32m payment which was due to paid to Elliott this week, according to people close to AC Milan’s leadership.”
According to the Times of Israel, Singer has direct ties to the so-called Trump Dossier, “The Washington Free Beacon confirmed it originally retained the political research firm Fusion GPS to scour then-candidate Trump’s background for negative information, a common practice known as “opposition research” in politics.”
“Leaders from the Free Beacon, which is funded largely by Republican billionaire Paul Singer, insisted none of the early material it collected appeared in the dossier released later in the year detailing explosive allegations, many uncorroborated, about Trump compiled by a former British spy reported the Times of Israel.
But when Trump looked like he would win the GOP nomination, Singer’s organization’s pulled funding. “But The Free Beacon told the firm to stop doing research on Mr. Trump in May 2016, as Mr. Trump was clinching the Republican nomination."
"Hillary Clinton’s campaign and the Democratic National Committee had begun paying Fusion GPS in April for research that eventually became the basis for the dossier,” reported the New York Times.
The Trump dossier unveiled the ties between Vladimir Putin and Trump’s business interests. The dossier was written by former British spy Michael Steele.