Gubernatorial candidate Bruce Rauner backed the boutique investment firm of a longtime business associate several years ago, only to be surprised when the Securities and Exchange Commission later shut down the firm for fraud.
In 2004, Mr. Rauner made a personal $4.5 million startup investment in fund manager Acartha Group LLC, a suburban St. Louis firm founded by Burton Douglas Morriss. Before Acartha, Mr. Morriss had already arranged one deal in which the duo made more than $75 million. Mr. Rauner, an avid outdoorsman, also owned a hunting camp with Mr. Morriss.
But in 2012, the SEC seized control of Acartha, accusing Mr. Morriss of defrauding investors of $9.1 million.
Mr. Rauner was a “passive investor” who was “misled and defrauded” by Mr. Morriss, like dozens of others, Mike Schrimpf, a spokesman for Mr. Rauner’s campaign, says in an email. “Bruce is angered and outraged by Morriss’ actions.” […]
The experience with Acartha could undercut his pitch that he is a savvy business executive who would bring that expertise to Springfield, a key part of his campaign for the Republican nomination for governor in the March 18 primary.
* And Doug Ibendahl has a long and involved piece about a new court filing in the Rauner-linked nursing home case. Click here to read the whole thing.