UAW Charges Romney With Profiteering From Auto Bailout

[markroxny]

Some car guy. Against the bailout? Romney is a P.O.S.

For Mitt Romney, it's one scary Halloween. The Presidential candidate has just learned that tomorrow afternoon (November 1) he will be charged by the United Automobile Workers (UAW) and other public interest groups with violating the federal ethics in government law by improperly concealing his multi-million dollar windfall from the auto industry bailout.
At a press conference in Toledo, Bob King, President of the United Automobile Workers, will announce that his union and Citizens for Responsibility and Ethics in Washington (CREW) have filed a formal complaint with the US Office of Government Ethics in Washington stating that Gov. Romney improperly hid a profit of $15.3 million to $115.0 million in Ann Romney's so-called "blind" trust.
The union chief says, "The American people have a right to know about Gov. Romney’s potential conflicts of interest, such as the profits his family made from the auto rescue. It’s time for Gov. Romney to disclose or divest.”
“While Romney was opposing the rescue of one of the nation’s most important manufacturing sectors, he was building his fortunes with his Delphi investor group, making his fortunes off the misfortunes of others,” King added.
The Romneys' gigantic windfall was hidden inside an offshore corporation inside a limited partnership inside a trust which both concealed the gain and reduces taxes on it.
The Romneys' windfall was originally exposed in Nation Magazine (and reposted on Truthout,) Mitt Romney's Bail-out Bonanza after a worldwide investigation by our crew at The Guardian, the Nation Institute and the Palast Investigative Fund.
The full story of Romney and his "vulture fund" partners is in the New York Times bestseller, "Billionaires & Ballot Bandits," available from Truthout with a contribution by clicking here.

According to ethics law expert Dan Curry who drafted the ethics complaint, Ann Romney does not have a federally-approved blind trust. An approved "blind" trust may not be used to hide a major investment which could be affected by Romney if he were to be elected President. Other groups joining the UAW and CREW include Public Citizen, the Service Employees International Union (SEIU), Public Campaign, People for the American Way and The Social Equity Group.
President Obama's approved trust, for example, contains only highly-diversified mutual funds on which presidential action can have little effect. By contrast, the auto bail-out provided a windfall of over 4,000% on one single Romney investment.
In 2009, Ann Romney partnered with her husband's key donor, billionaire Paul Singer, who secretly bought a controlling interest in Delphi Auto, the former GM auto parts division. Singer's hedge fund, Elliott Management, threatened to cut off GM's supply of steering columns unless GM and the government's TARP auto bailout fund provided Delphi with huge payments. While the US treasury complained this was "extortion," the hedge funds received, ultimately, $12.9 billion in taxpayer subsidies.
As a result, the shares Singer and Romney bought for just 67 cents are today worth over $30, a 4,000% gain. Singer's hedge fund made a profit of $1.27 billion and the Romney's tens of millions.
The UAW complaint calls for Romney to reveal exactly how much he made off Delphi -- and continues to make. The Singer syndicate, once in control of Delphi, eliminated every single UAW job --25,000-- and moved almost all auto parts production to Mexico and China where Delphi now employs 25,000 auto parts workers.

http://truth-out.org/buzzflash/comme...m-auto-bailout

[LexusLover]

The UAW "bosses" are trying to create a smoke screen to conceal the Obaminable "bail out" funds that supplemented the pension fund shortfall so that the UAW-Pension Fund could continue paying the full benefits to the retirees, unlike other providers for GM, like Delphi, who were denied "full" reimbursement of pension fund losses from the union bosses raiding the fund accounts.

Delphi went into bankruptcy and the bankruptcy judge/referees got a whif of that .. and GM was not forced during bankruptcy to supplement the pensions without the bailout and the UAW got a walk on paying the money back. The non-union employees got screwed out of their pensions.....the union folks got a walk and the workers got full pensions in return for their .... loyalty to Obaminable.

Smoke and an effort to piss off the rank and file who are now pissed at Obaminable.

It's called ... Chicago. Buying votes with taxpayers' dollars!!!!

Next thing you know Obaminable will be passing out $100 bills on the road for votes!

[chefnerd]

In reality LL, it was Romney's hedge fund cronies at Elliot, Paulson, Silver Point, and Third Point are the ones who literally destroyed Delphi. They used their Delphi debt holdings, obtained at about $.20 on the dollar, to buy Delphi in the bankruptcy proceedings effectively killing an agreed on deal by another party. They then held GM hostage by refusing to release parts unless concessions were made, including the government taking over the pension payments of Delphi. Afterwards, they then moved 20,000 jobs to China to make the parts i factories they purchased from Bain Capital.


http://www.thenation.com/article/170...ilout-bonanza#

http://abcnews.go.com/Blotter/mitt-r...3#.UJCeEY5ORSV

[Yssup Rider]

Yeah, say what you want LL. Romney's been terribly mistaken about his being bulletproof because of Bain and the Bainous things they did to American companies and workers.

Pity they didn't bring the suit earlier. Won't do much good now.

But he's on the downward slope and snowballing toward the inevitable meltdown Tuesday.

So do try and smile and enjoy it...

[LexusLover]

Originally Posted by chefnerd

In reality LL, it was Romney's hedge fund cronies at Elliot, Paulson, Silver Point, and Third Point are the ones who literally destroyed Delphi.

You skipped a couple of beats/steps.

The administration allowed no funding to Delphi, so Delphi was left with private resources ... and private investors are not going to bail out union sops who steal from union pension funds. Had the administration approved the additional funding for the NON-union members then we wouldn't be having this dicussion on this board.

Bottom line. They don't need the votes to put them back in for another 4 year-term. If their investment goes tits up they get kicked out without an election.

Just face it. Unions have benefitted more than any other "sector" from the bail out funds during the past 3+ years and they have gotten passess on Obamacare mandates. Obaminable takes care of the unions, even if he leaves the Blacks, Hispanics, and "young" people behind in the dust.

[CJ7]

Originally Posted by LexusLover

You skipped a couple of beats/steps.

The administration allowed no funding to Delphi, so Delphi was left with private resources ... and private investors are not going to bail out union sops who steal from union pension funds. Had the administration approved the additional funding for the NON-union members then we wouldn't be having this dicussion on this board.

Bottom line. They don't need the votes to put them back in for another 4 year-term. If their investment goes tits up they get kicked out without an election.

Just face it. Unions have benefitted more than any other "sector" from the bail out funds during the past 3+ years and they have gotten passess on Obamacare mandates. Obaminable takes care of the unions, even if he leaves the Blacks, Hispanics, and "young" people behind in the dust.

and you left out a step ... Bush, not Obie set up TARP and bailed out the car boys

[chefnerd]

In actuality, if you care to read the articles posted you will find this is the first one:

Altogether, in direct and indirect payouts, the government padded these investors’ profits handsomely. The Treasury allowed GM to give Delphi at least $2.8 billion of funds from the Troubled Asset Relief Program (TARP) to keep Delphi in business. GM also forgave $2.5 billion in debt owed to it by Delphi, and $2 billion due from Singer and company upon Delphi’s exit from Chapter 11 bankruptcy. The money GM forgave was effectively owed to the Treasury, which had by then become the majority owner of GM as a result of the bailout. Then there was the big one: the government’s Pension Benefit Guaranty Corporation took over paying all of Delphi’s retiree pensions. The cost to the taxpayer: $5.6 billion. The bottom line: the hedge funds’ paydays were made possible by a generous donation of $12.9 billion from US taxpayers.


Later on:

Another outcome may have been possible. In June 2009, the Treasury and GM announced a bailout deal they’d crafted over months with the cooperation of the United Auto Workers. GM would take back control of Delphi via a joint venture with Platinum Equity, a buyout firm led by billionaire Tom Gores, a self-described “Michigan man” who grew up in the shadow of Delphi’s Flint plant.

The final Platinum plan, according to Delphi’s official statement posted on Marketwire in June 2009, lists plants in fourteen locations slated for closing, which would have left several of Delphi’s plants still in business, still unionized—and still in the United States. Crucially, the deal would have returned key Delphi operations, including the production of steering columns, directly to GM.

The hedge funders stunned Delphi by refusing to accept the Platinum plan. Harshly criticizing it as a “sweetheart deal,” they demanded 45 cents on the dollar for the debt bonds they had bought on the cheap—more than double what the Treasury-brokered Platinum deal would pay.

Then the Singer-led debt holders swooped in. After the Platinum deal was announced, Elliott Management quietly tripled its holdings of Delphi bonds, purchased at just one-fifth of their face value. By joining forces with Silver Point, Paulson and Loeb, Singer now controlled Delphi’s fate.

Gores, Delphi and UAW officials declined to respond to queries about the deal on the record, but the sworn deposition by Delphi CFO Sheehan (confidential then, but later posted on Scribd.com) lets us in on the tense negotiations culminating in a twenty-hour showdown between Delphi, GM, the UAW, the Auto Task Force and the US pension agency, on the one hand, and Singer’s hedge fund group, on the other. Delphi said it would dump the Platinum deal if the hedge funds would agree to terms that would take care of all stakeholders, including the following stipulation: “Agree on plan structure to maximize job preservation.”

The hedge funders said no, since they had a billion-dollar ace up their sleeve. According to Sheehan, Singer and company’s controlling interest allowed them to force the bankruptcy judge to hold an auction for all of Delphi’s stock. The debt holders outbid the Michigan Man’s team, offering $3.5 billion. But it wasn’t $3.5 billion in cash: under the rules of Chapter 11 bankruptcy, debtors-in-possession may bid the face value of their bonds rather than their current market value, which at the time was significantly lower. Under the Platinum deal, Delphi would have had much more in real money for operations: $250 million in cash from Gores, another $250 million in credit, and $3.1 billion in “exit financing” from GM, all of it backed up by TARP. Still, under Chapter 11 rules, the Platinum bid was technically lower. And that’s how Singer’s funds—which included the Romneys’ investment—came to buy Delphi for the equivalent of only 67 cents a share.

Rattner and GM, embarrassingly outmaneuvered, tried to put a good face on it. As Rattner wrote in his memoir, “In truth we didn’t care who got Delphi as long as GM could extricate itself from the continual drain on its finances and assure itself of a reliable supply of parts.”

But Delphi somehow got no government funding?