Sunday, June 29, 2014

Bill Clinton's Undeclared Carlyle Group Speech

FT reported ex-President Bill Clinton's spoke at The Carlyle Group's annual investor meeting in 2012.  This was not Carlyle's NASDAQ unit-holder gathering, but the meeting of Carlyle's high dollar private equity investors.  FT's piece stated:

Private equity groups compete with each other to host the most glitzy affairs and solicit the biggest names. Last September, Carlyle’s co-founder David Rubenstein led a question-and-answer session with Mr. Clinton, who charges as much as $200,000, at its annual event.

Why doesn't Clinton's federal financial disclosure filing include Bill's Carlyle Group speaker fee from September 2012?  Because it doesn't fit with the narrative for Hillary's Presidential run.  Clinton's listed September speeches include:

Five Star Institute - Sept. 7, 2012
Solar Energy Trade Shows LLC - Sept. 12, 2012
C3 Summit LLC - Sept. 13, 2012

Bill's Carlyle talk likely would've been September 10 or 11, 2012.  Clinton made other PEU speeches that year, including:

GTCR - June 27, 2012
Pershing LLC - June 6, 2012
UBS Wealth Management - 3 speeches, Feb. 2, April 17 and Oct. 18
J.P. Morgan -  Oct. 17, 2012
Goldman Sachs - Oct. 23, 2012
Mortgage Bankers Assoc. of America - Oct. 23, 2012

Bill's missing Carlyle Group speaker fee brings to mind two other PEU omissions.  One, The Carlyle Group's LifeCare Hospitals got not one mention in the Bush White House Lessons Learned report on Hurricane Katrina.  LifeCare had the highest number of patient deaths in Katrina's aftermath.  Thirty five patient deaths warranted not a peep from Frances Townsend, the report's author. 

Two, residual private equity stakes have been as absent as Clinton's Carlyle Group fee.  For years White House Health Reformer Nancy-Ann DeParle's disclosures showed no residual PEU holdings from CCMP affiliates.  Yet later, residual profits from the sale of a healthcare affiliate appeared.

DeParle's 2011 filing showed a gain from her earn out from MedQuest, a medical imaging company.  Nowhere on two prior disclosures did she indicate residual private equity stakes in MedQuest or any other healthcare firms, where she served as a board member.

Private equity underwriters (PEU's) metastasized from leveraged buyout organizations (LBO's).  Oddly, convicted LBO genius Michael Milken now operates a global confab called The Milken Institute Global Conference.  Clinton spoke at that event in 2012 and also failed to list this speech or its income in the federal disclosure filing. 

What is it about private equity that enables residual stakes and speaking fees to be secret from public disclosure?  The PEU world thrives on secrecy and elected leaders foster such.  Politicians Red and Blue love PEU.

Update 4-23-15:  WaPo found what PEU Report discovered last year.