What do poor people in Mississippi have in common with Alaskan Native Corporations? Both groups were used by people wanting to achieve big profits.
Selling Alaskan Native tax losses to corporations produced the seed money to start The Carlyle Group. Tax losses or tax credits offset a company's tax liability.
Between 1986 and 1988, Alaskan Native Corporations sold an estimated $1.5 billion in losses, for $426 million in revenues. Congress disallowed the practice in 1988.
David Rubenstein used the proceeds from those sales to fund The Carlyle Group, a politically connected private equity underwriter (PEU). Policy making billionaire Rubenstein recently highlighted the benefits of Carlyle's being in our nation's capital. The public noticed Congress maintained private equity's preferred "carried interest" taxation yet again.
Mississippi officials steered $2.15 million in federal TANF welfare money to fund a fledgling pharmaceutical company. The money was routed through a nonprofit agency. Involved parties believed they would make a fortune from "their" equity investment in Prevacus/PresolMD.
This group of PEU wannabees included Mississippi Governor Phil Bryant, the head of the state welfare agency John Davis, nonprofit leader Nancy New and her son Zach. On the periphery sat Brett Favre, investor and believer in Prevacus/PresoldMD's concussion reducing drug treatment. Mississippi Today reported:
Nancy New, a once prominent private school and nonprofit founder, and her son Zach New pleaded guilty to state criminal charges in Mississippi’s sprawling welfare scandal on Friday.It's not clear how much equity the $2.15 million purchased. Also, what happened to that stake when Odyssey Group International purchased Prevacus' drug candidate PRV-002, a concussion drug therapeutic compound (mild traumatic brain injury) in January 2021?
The prosecutor looking into the role of peripheral persons (Farve and Bryant) was let go. Nothing to see here folks, just a few shady bureaucrats and a nonprofit who acted on their own. Never-mind internal financial controls, audit trails or board of director decisions.
