A company closely tied to former Democratic Party Chairman Terry McAuliffe, and currently under scrutiny for allegedly trying to win political favors from the Department of Homeland Security, earned high-powered support only a few years ago from Republican Gov. Bobby Jindal of Louisiana and then-Mississippi Gov. Haley Barbour, according to documents obtained by a nonpartisan watchdog group.
Both Jindal and Barbour wrote letters to DHS in 2008 seeking federal approval for the firm Gulf Coast Funds Management to become a regional EB-5 center – a hub that helps channel foreign investment into American projects and opens a path to green-card status for foreign businessmen.
GCFM, which is now headed by former Secretary of State Hillary Clinton’s brother, Anthony Rodham, has recently been drawn into an internal government investigation into whether a DHS official inappropriately aided the firm.
Republicans have sharply criticized McAuliffe and his former car company, GreenTech Automotive, for collaborating with GCFM and allegedly trying to use political influence to win government approval for EB-5 investments in Virginia. McAuliffe’s relationship with GreenTech started in 2009, well after the Jindal and Barbour letters were sent.
Jindal chairs the Republican Governors Association, which has attacked McAuliffe in TV ads for his ties to GCFM (one August ad cited this POLITICO headline: “Report: DHS probes firm with ties to Terry McAuliffe.”) The Louisiana governor has said that McAuliffe “disqualified” himself from high office through his questionable business dealings.
In documents obtained by the group Cause of Action – and shared exclusively with POLITICO – Jindal and Barbour endorsed GCFM’s bid to become a regional visa center servicing Mississippi and Louisiana. They jointly wrote to Homeland Security Secretary Michael Chertoff on June 19, 2009, to seek support for a company that they said would help the region bounce back from natural disasters.
“We believe that the situation in Mississippi and Louisiana is uniquely affected by the storms of 2005, and GCFM should be granted an exception to invest at the $500,000 level in both states,” the two governors wrote. “These areas are ‘targeted employment areas’ because only capital investment that creates new jobs can bring full recovery and allow all of our people to come home. Given these issues, we request your support for the GCFM regional center in a manner that allows it to fulfill the objectives of the EB-5 program and put funds to work to create needed jobs in Louisiana and Mississippi.”
Earlier in the year – on Feb. 27, 2008 – Jindal wrote separately to Chertoff to lobby for “a regional [EB-5] center that serves all of the state of Louisiana” and mentioned GCFM by name.
“The EB-5 program is an efficient way to direct private equity into all of the regions in Louisiana that need investment capital,” Jindal wrote. “I further understand that Gulf Coast Funds Regional Center has an application pending at this time for a regional center that serves both Louisiana and Mississippi. I ask you to evaluate this application, and all regional center applications from this area as quickly as possible so that investor dollars can be put to use immediately.”
Both Barbour and a spokesman for Jindal told POLITICO that at the time the two governors expressed support for GCFM, neither Terry McAuliffe nor GreenTech Automotive were involved in the project. Rodham only appears to have come on board at GCFM several years later, and McAuliffe didn’t become chairman of GreenTech until after his losing 2009 bid for governor of Virginia.
Barbour said that the point man at the time for GCFM had been a New Orleans-based investor, David Voelker, who died in May of this year. The DHS approval letter for GCFM’s regional center application, dated Aug. 18, 2008, is addressed to Voelker and another investor, George E. Brower II.
“At the time the letter was written, it was different people who were going to have the EB-5 center [and] we were dealing with a different automobile company,” said Barbour, himself a former RGA chairman.
He said a pair of foreign businessmen, Benjamin Yeung and Charles Wang, were involved in the initial EB-5 center application; only Wang ultimately went on to become deeply engaged with GreenTech and its investments in Mississippi.
“There was, as far as I know, no relationship with Hillary Clinton’s brother [in 2008],” Barbour said, emphasizing: “These are different people at a different time.”
Jindal spokesman Kyle Plotkin said in an emailed statement that it was not surprising that the two governors teamed up to advocate for economic development in their two states, and noting that McAuliffe’s involvement with GCFM came later.
“Louisiana and Mississippi have often cooperated since Hurricane Katrina to cut federal red tape and encourage private sector job creation,” Plotkin said. “It’s unfortunate that well after these letters were sent Terry McAuliffe tried to abuse this federal program and take advantage of a town in North Mississippi. Federal authorities should hold him accountable for any violations that might have occurred.”
An email to a GCFM inquiries address seeking comment was not immediately returned.
Cause of Action executive director Dan Epstein said that regardless of the timeline of GCFM’s activities and its relationship with prominent Democrats, that Jindal and Barbour had “very clearly lobbied for GCFM to get approval as a regional center.”
“Political connections should never be the grounds on which a company gets support from the government. We want a transparent and competitive system,” said Epstein, whose group has been highly critical of McAuliffe and his various business connections during the current gubernatorial race.
He noted dryly that Jindal is now “rather critical of Terry McAuliffe and actually cites Mr. McAuliffe’s bad businesses with GreenTech Automotive, which is of course financed by Gulf Coast Funds Management.”