Wake County Leaves Non-Citizens on the Voter Rolls

It sounds as if Jay Delancy of Voter Integrity Project (VIP) was a bit disappointed after the hearing at the Wake County Board of Elections yesterday.  You will remember that VIP had discovered hundreds of “citizens” who claimed to be citizens when they registered to vote and then claimed to be non-citizens when they were called to jury duty in Wake County.  VIP compared the list they received from the Wake County Clerk of Court’s office and matched, to the best of their ability, the names to voters on the rolls.  They then challenged the voter registrations of those people who said they were not citizens to the jury summons and said they were citizens on the voter registration form.

Delancy admitted to being frustrated – and who could blame him?

Laura Leslie (a reporter from WRAL) asked Delancy, “Sir doesn’t the law say that they have to presume (because it’s a constitutional right to vote) they have to presume that these people that they are legit unless there is proof they are not?”  Delancy replied, “If someone provides a document to the clerk of court that they are not a citizen – to me that is proof, but obviously to this board, (Wake County Board of Elections) it is not.

When asked by another reporter, “Why should the average voter (who is a citizen) be concerned about what’s going on?  Delancy answered; “The average voter should be afraid because we have a lot of people walking around North Carolina right now who are not citizens who are registered to vote (we just found a few of them) and the board of elections has made it clear they want to take them on the voter roll – I fear for our elections .”

No doubt, speaking on behalf of that the State Board of Elections, Bob Hall interrupted Delancy’s interview by saying “You have wasted the taxpayer’s time.”  Hall is Director of the ultra-liberal advocacy group Democracy NC and works closely with the State Board of Elections.  He admonished Delancy for researching the voter rolls to find people who are registered illegally and proceeded to suggest possible scenarios as to why the people in question might not be illegal voters.

Hall finally exited Delancy’s interview by saying that “I agree with you, we don’t want citizens to be voting.”  (Hall frequently resorts to silliness when he is talking to someone with whom he disagrees)  Outside of the State Board of Elections, only the old liberal media look to Bob Hall for his opinions.  Hall should read NCGS 163-85, he would see that the statute reads: Any registered voter of the county may challenge the right of any person to register, remain registered or vote in such county. Reporters like Laura Leslie like to call Hall a watchdog,  but really he is just a lapdog for the liberal left and funders like George Soros and even Capitol Broadcasting’s Chairman, Jim Goodmon – reporter Leslie’s boss.

North Carolina’s voter rolls are a mess.  Non-citizens populate the voter list along with the deceased and absolutely no law prevent them from voting.  VIP is doing their best to identify names that should not be on the rolls, both dead and non-citizens.  You see, they must do this work, because the State Board of Elections will not and in doing this work VIP has emabarrased Gary Bartlett, Director of the State Board of Elections – that is why Bob Hall popped into the interview.

And on that note – there is some good news – it looks like the work VIP has done in several counties to identify deceased voters has shamed the Board of Elections into at least looking like they are attempting to look for the deceased in the rolls.  I received the email below yesterday – it’s from the State Board of Elections to the County Board’s Directors.   The email directs the counties to work with a new audit report to identify voters who have died and should be removed.  (The list consists of people who died between 2002 and August 2012).

VIP is making a difference and you can too, don’t let bullies like Bob Hall stop you.

Cowell Facebook Fiasco: More Questions That Demand Answers

As the old saying goes, when looking at politics always follow the money.

Having just scratched the surface looking into the Janet Cowell Facebook fiasco, that’s just what I decided to do. The results are unsurprising, and intriguing.

To recap, North Carolina State Treasurer Janet Cowell invested about $26 million of state pension fund dollars in the Facebook IPO. As we all know by now, Facebook stock has dropped significantly, thus the pension fund has lost an estimated $4 million on that risky investment. The losers in this, of course, are taxpayers who will need to continue to finance the now insufficient pension fund. Cowell, in turn, has decided to join a class action lawsuit against Facebook, and the NC pension fund stands to be the lead plaintiff due to the size of its losses.

But there were some big winners in this ordeal, and certainly some connecting of the dots of the major players in this scenario should raise the eyebrows of government watchdogs, taxpayers, and retired teachers and government employees across the state. Following are the most relevant details:

As reported previously, Erskine Bowles sits on the Board of both Facebook and Morgan Stanley – two companies that were winners in this deal. FB of course raised billions from investors on quite possibly overvalued stock, and Morgan Stanley  earned millions as the chief underwriter of the IPO. As reported in the Wall Street Journal:

The deal was lucrative for the lead underwriters. In large IPOs, it is common for fees to be split relatively evenly between several lead underwriters. On the Facebook deal, Morgan Stanley stands to collect $68 million in fees—38.5% of $176 million slated to go to about 30 underwriters, public filings indicate. J.P. Morgan will get about 20%, and Goldman, 15%

And, in spite of the fact that FB stock prices have plummeted, Morgan Stanley made even more money off of the stock through a practice known as “stabilization.” The Wall Street Journalexplains:

Profits made by banks underwriting Facebook Inc.’s initial public offering as the stock fell were distributed this past week from a pool of about $100 million, say people with knowledge of the deal.

The banks together made the money through a process known as stabilization, which is a standard procedure in IPOs, though Facebook’s deal size made the profits larger than normal, these people said.

……

Stabilization works this way, people familiar with the process say: If investors are selling the stock after the IPO launches, pushing the price lower, bankers can step in and buy shares at the IPO price in an attempt to keep it from falling below its issue price. This also serves to cover their short positions. If a short position remains on their books and the stock keeps falling—which was the case with Facebook on subsequent trading days—the underwriters can continue to cover their short positions by buying back shares at prices below the IPO price, netting a profit.

There is no risk to the banks in this effort. If the stock only trades up, the short position is covered when banks exercise what is known as an overallotment option, buying more shares from the newly public company at the IPO price. The banks don’t lose money, and the new public company makes more money when the overallotment is exercised.

So there was no risk to Morgan Stanley as part of this deal, and in fact the drop in FB stock meant Morgan Stanley was able to make tens of millions more on the deal.

Now recall that Erskine Bowles and his wife hosted a fundraiser for Janet Cowell. Any conflict of interest there? Bowles raises funds for Cowell, then Cowell throws millions at the FB IPO in which Bowles sits on not one but two boards of companies standing to reap millions.

But wait, that’s not all.

Representing the North Carolina pension fund in the lawsuit – and jockeying to become lead counsel in the case – is the firm Bernstein Litowitz Berger & Grossmann. The New York based firm stands to make a lot of money in legal fees if they are chosen lead counsel.

An examination of political contributions to Janet Cowell’s campaign since 2008 courtesy of the NC State Board of Elections shows that employees of Bernstein have donated nearly $75,000 to Cowell in the last two elections cycles.

Interestingly, the donations include three in-kind donations for room/lodging in New Orleans. The contributor of this in-kind donation is Anthony Gelderman III, who is highlighted in this 2004 Forbes article as one who has “used political ties to turn Louisiana’s pension funds into a profit center for his New York law firm, Bernstein Litowitz.” Indeed, the article discusses a previous class action suit in which Bernstein tried to bill its clients (including major public pension funds) more than $10,000 per hour. The article also notes that Bernstein’s business model seems to include cozying up to politicians and then leverage that relationship for lucrative class action suits:

Despite its New York roots, Bernstein Litowitz is especially influential in Louisiana. The state’s public pension funds have retained the firm for at least 15 class actions. Bernstein Litowitz has contributed more than $90,000 to Louisiana politicians since 1996. It gave $38,000 last year, 83% of its contributions nationally.

Now it appears they are bringing that shady practice to North Carolina.

Every step in this story involves the politically-connected (Bowles/Morgan Stanley, Bernstein Litowitz) reaping major financial rewards, with taxpayers and perhaps NC state retirees on the hook. And Janet Cowell is squarely in the middle of it.

This whole Facebook fiasco begs a number of questions:

  • Was the risky Facebook investment a quid pro quo deal between Cowell and Bowles?
  • What about the selection of Bernstein as counsel in the class action suit, given their generous donations and cozy relationship with Cowell?
  • What was Cowell doing in Louisiana multiple times in the last few years?
  • What is a New York based law firm with much of its business in Louisiana doing donating to the North Carolina State Treasurer, if not sniffing an opportunity to someday milk the pension fund for outlandish legal fees by representing the fund in a class action suit?
  • Will NC taxpayers be on the hook for $10,000 an hour legal fees?
  • Should retired teachers and state and local government employees be comfortable with how their pension is being managed?
  • Does anybody else see any conflict of interests in this whole ordeal?

State and local government retirees – and taxpayers –  deserve some answers.

UPDATE: This original post included an erroneous spreadhseet of Bernstein, Litowitz Berger & Grossmann employees’ contributions to Cowell – it mistakenly listed several donations from earlier election cycles twice. The total came to nearly $100,000. The corrected spreadsheet is now available at the link provided above, and reflects what should be the correct total amount of nearly $75,000. Civitas regrets the error.