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* Crain’s…
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.
posted by Rich Miller
Monday, Feb 24, 14 @ 10:37 am
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If Schrimpf is correct, this one won’t have much legs.
Throw enough stuff like this out there, however, and pretty soon all those little matches start a great big fire.
Looks like smoke on yonder horizon.
Comment by Formerly Known As... Monday, Feb 24, 14 @ 10:44 am
It may undercut him, but the fact that he is a billionaire with many varied $ interests would also lend credence that he knows his way around the business world, for better or worse, hook or crook
Comment by Anonymous Monday, Feb 24, 14 @ 10:45 am
Contrary to what the Tort Reformers would have us believe, juries just don’t award millions of dollars on BS cases with no liability and damages. No defense that you let the corporation default. Just a business strategy to save litigation costs because you are judgment proof.
The affect of this on Rauner supporters? Mostly zero. They believe Rauner and his companies are the victims of greedy trial lawyers. The same goes for the anti-Rauner literature; just those union bosses beating up on Brucie.
Comment by Samurai Monday, Feb 24, 14 @ 10:50 am
This goes right to the heart of Rauner’s claims that he will run the government like a business. And why is Rauner settling RICO claims?
Shake down Springfield is the motto…
Comment by Cincinnatus Monday, Feb 24, 14 @ 10:54 am
He’s a tough, “hands-on” guy who wants to run the state likes his businesses and shake things up.
But whenever any heat comes his way, he’s a “passive investor,” or didn’t know who worked for him, or wasn’t really involved, or can’t remember who talked to whom.
You can’t be Sgt. York and Sgt. Schultz at the same time.
Comment by wordslinger Monday, Feb 24, 14 @ 10:54 am
Running government more like a Busness? Good. Running government like a rauner Busness? Despicable! If rauner wins the republican primary you can count on an independent canidate for governor!
Comment by William j Kelly Monday, Feb 24, 14 @ 10:55 am
=The affect of this on Rauner supporters? Mostly zero. They believe Rauner and his companies are the victims of greedy trial lawyers. The same goes for the anti-Rauner literature; just those union bosses beating up on Brucie.=
Then how about getting to special treatment to get his daughter in to a highly competitive high school or paying hundreds of thousands of dollars to democratic politicians? What do Rauner supporters feel about that?
Comment by Anonymous Monday, Feb 24, 14 @ 10:55 am
Way too little, WAY too late for this “little”
However…
===You can’t be Sgt. York and Sgt. Schultz at the same time.===
Great line. Perfect. Just too late(?)
Comment by Oswego Willy Monday, Feb 24, 14 @ 10:57 am
All the has to do is convince voters he will be better than Quinn and won’t go to jail like Ryan and Blagojevich.
In a party full of losers like the Illinois GOP and in a state filled with crappy governors - it doesn’t take much and Rauner has enough.
Comment by VanillaMan Monday, Feb 24, 14 @ 10:59 am
===I’m thinking the UMWA under John L. Lewis for one example===
The guy founded the CIO, which changed the very nature of organized labor in this country and raised living standards for millions. Perhaps you could learn some history as well.
Comment by Rich Miller Monday, Feb 24, 14 @ 11:02 am
“What do Rauner supporters feel about that?”
I would also like to know how they feel about Rauner running as an “outsider” to stand up to “corrupt” union bosses and politicians, when he was one of the people profiting immensely from the status quo, via government employee pensions.
Comment by Grandson of Man Monday, Feb 24, 14 @ 11:03 am
Venture Capital World includes some deceptive practices, hidden financial manipulation, destructive behavior, and outright marketplace and investor fraud. That is sometimes why so much profit is produced.
It is also filled with risk and has some very talented, hardworking, and ethical players. Some win big in the right ways. Even the best cannot avoid some of the slime splashing on them.
It is more “shark tank” than “business incubator.”
It’s not the typical large corporate or small business world and culture.
Bringing the Venture Capital World into government is not the same as “running government like a business” as the voters generally thing of the phrase.
Comment by Walker Monday, Feb 24, 14 @ 11:27 am
Remember the deal that made Rahm Emmanuel a rich man:
Rauner made lots of money - $100MM into $500MM in less than 6 months
Rahm received huge commissions
Daley was running SBC
3,500 employees outsourced or sacked
Oh - by the way, the buyer, TYCO CEO, Dennis Kozlowski, he went to jail too.
Rauner runs with a very dangerous crowd…….
Comment by wondering in Lake County Monday, Feb 24, 14 @ 11:37 am
Venture Capital by its very nature is a high risk/high reward business. There are people who act fraudulently on too regular of a basis. Think of all of the state and federal funds that have been wasted or squandered before they got to the place where they were intended. This one’s pretty hard to explain to people in a way they could understand it fully. It’s also 2004. This kind of “oppo” is reaching. I can see why it was the third or fourth arrow. They’d have been better off trying to pound their first two. Now it’s officially reaching.
Comment by A guy... Monday, Feb 24, 14 @ 11:42 am
Rauner obviously is better at making money off unprotected seniors living in his substandard nursing homes.
Comment by very interesting Monday, Feb 24, 14 @ 11:56 am
A tale of two early Conservative Southwest Suburban Endorsers after receiving the first anti-Rauner mailer.
Hello committee:
Just read the Shearer anti-Rauner mailer. Wondering if we made a mistake at the endorsement session. This is pretty scary stuff about Rauner if true. He [Rauner] always said he played with the powers that be and that has always been the Democrats. So the question is, will he continue playing his game for his benefit after elected. In the future we should obtain more information about candidates before a vote.I am no longer sure about our choice.
Demitri:
The mailer was powerful and many voters will be influenced by it. A lot of insinuations, but just the same old unproductive smear tactics used by these other candidates that should be saved for Durbin and Obama. It is all so repulsive from those that have corrupted this State.
Take away for me. The “One Percenters” know, but don’t care; Rauner is their guy. The others, don’t know and if they come to know, just might suffer buyer’s remorse. Better before the primary than after.
Comment by Samurai Monday, Feb 24, 14 @ 12:03 pm
– You can’t be Sgt. York and Sgt. Schultz at the same time. –
–Word–, great comparison.
Comment by RNUG Monday, Feb 24, 14 @ 12:32 pm
If the nursing home allegations can hold and be boiled down to a few simple items, that is the message that will hurt downstate. Don’t think there is enough time and money to get the message out.
Comment by RNUG Monday, Feb 24, 14 @ 12:36 pm
– You can’t be Sgt. York and Sgt. Schultz at the same time. –
brilliant Word
Comment by PoolGuy Monday, Feb 24, 14 @ 12:39 pm
==If the nursing home allegations can hold and be boiled down to a few simple items, that is the message that will hurt downstate. Don’t think there is enough time and money to get the message out.==
Agree with you completely, RNUG.
There are so many attacks on Rauner - “he’s too rich/out of touch” / “he’s a hypocrite cheap watch-wearer” / “he invested in some companies with unethical practices” / “he used his influence to get his daughter into a better high school” / “his economic programs don’t add up” - so many things to attack him on, but none an election death blow.
But profiting off of endangering seniors? That’s the outside chance of taking him down. And it needs a compelling victim. A son/daughter of someone who was abused in the nursing home, telling the story, crying on camera.
Comment by Robert the Bruce Monday, Feb 24, 14 @ 1:28 pm
Yeah, any attack ad needs to be short, factual but blunt to the edge of libel, and needs a single theme. Then it needs to be run constantly.
Comment by RNUG Monday, Feb 24, 14 @ 2:47 pm
–Yeah, any attack ad needs to be short, factual but blunt to the edge of libel, and needs a single theme. Then it needs to be run constantly.–
Rauner’s cease-and-desist demand on the “ineffective” nursing home spot certainly implied defamation of character and libel. There are remedies in law for that.
You want to go that route, dude, presenting facts to a judge in a court of law? You chose not to defend yourself in the bustout of the nursing homes, instead walking away and hiding in bankruptcy.
Yeah, run the state like your businesses.
Shake it up, daddio. Put your big-money where your eternal-victim-mouth is.
Comment by wordslinger Monday, Feb 24, 14 @ 3:44 pm
Great line Word, but does enough of the public remember the two Sgts?
Comment by D.P.Gumby Monday, Feb 24, 14 @ 3:53 pm
–word–
I agree he ducked court on that one even though he now sends a cease and desist. I’m thinking an even blunter attack ad on his buying the election needs to be run. I could write it in about 30 seconds but I don’t know if anyone would have the guts to run it.
Comment by RNUG Monday, Feb 24, 14 @ 5:32 pm
I’m thinking more of Rauner just because Ibenthal is always wrong
Comment by wishy washy Republican Monday, Feb 24, 14 @ 6:37 pm
The Pounding (sorry, Bruce, but you’re in the “Big Time,” now Rich Palomino) continues, and it will not STOP now until Election Day, and I mean the BIG One…in November. And, sadly, no Coat of Armor he tries to put on or arrow he tries to fling back (via TV/radio response ads) will be able to shield him from suffering some real serious, painful body blows, many which’ll be peneTRAtions that will jolt him like a bolt of lightning, he will have to TAKE those hits, and they WILL inevitably cause br damage–in fact, they already HAVE…! How he fares in the end depends in part how well he can weather these blows…most Republicans in Illinois in recent years in Big Races like the Upcoming General have not and cannot…
Comment by Just The Way It Is One Monday, Feb 24, 14 @ 8:04 pm
Note the words that Mr. Rauner made a PERSONAL donation. How can he be trusted to run our government when he now has a track record of both personal and business decisions that are very poor, and VERY wrong.
Comment by Think About It Tuesday, Feb 25, 14 @ 8:37 am