New York Post: Barclays builder ‘pay to play’

Read the full story here: New York Post

“For far too long, Forest City Enterprises has operated on the model of political profiteering, essentially rigging the marketplace by paying off government officials with lavish campaign contributions and gambling with taxpayer funds for its private profit,” said Dan Epstein, CoA’s executive director.


The oversight group accuses the company of a “decade of kickbacks” and coordinating its campaign contributions, and says it is investigating multiple companies that use “political connections for profit.”

REPORT: Political Profiteering: How Forest City Enterprises Makes Private Profits at the Expense of America’s Taxpayers Part I

Executive Summary

When the politically powerful, not the competitive marketplace, determine winners and losers in America’s business decisions, taxpayers take on all of the risk and crony companies extract the profits. The cycle of political profiteering is born when politicians exchange public subsidies for campaign contributions. This method of using the government to profit has become a trademark of one of the largest publicly traded real estate development companies in the United States: Forest City Enterprises.

Forest City Enterprises (FCE) is a $10.6 billion company that most Americans have likely never heard of, even though the public finances twenty-three percent of FCE’s revenue. The FCE business model is dependent upon political profiteering: relying on public money and government influence to reap millions in profit.  Using highly paid lobbyists, political connections, campaign contributions, and strategic hiring of government officials, FCE obtains lavish public subsidies, tax-exempt financing and the seizure of private land from eminent domain condemnations.

The following report exposes the money trail between FCE and its political friends that have resulted in a decade of kickbacks for both FCE and politicians. Between 2002 and 2012, FCE, its subsidiaries, and its employees spent $23 million on campaign contributions and lobbying at the federal, state, and local level. FCE even went so far as to coordinate donations among employees in its project locations: $15.4 million of the $23 million in contributions were made by multiple employees of FCE on the same day. During that same time frame, FCE and its subsidiaries received or signed agreements for fifty-two direct and indirect government subsidies or financial benefits with a total value of at least $2.6 billion. The subsidies amounted to twenty-three percent of FCE’s $11.4 billion revenue during that time period.

The FCE business model is one that damages competition in the market by abusing market mechanisms in ways that capitalizes off government handouts. This report is Part One of a three-part series examining how Forest City Enterprises uses politics to profit.





Preview of subsequent reports:In the reports that follow, resulting from Cause of Action’s two year investigation, CoA will show how FCE took public benefits under the premise of providing jobs for minority workers but failed to deliver as well as how FCE enriched itself through bribery and political graft, without ever being subject to investigation or oversight.

Subsidy and Political Spending Data:

Forest City Enterprises Data

Emails from Forest City Washington’s Alex Nyhan to former colleagues at the District of Columbia (D.C.) Office of the Deputy Mayor for Planning and Economic Development

Forest City Washington Emails

Full FOIA Production



The Daily Caller: McAuliffe’s GreenTech company bypassed state law in acquiring land, failed to produce a single car

McAuliffe’s GreenTech company bypassed state law in acquiring land, failed to produce a single car

Patrick Howley


10:47 PM 07/31/2013

Virginia candidate for governor Terry McAuliffe bypassed state law to acquire land for his “green car” factory in Mississippi and invited President Obama to attend an event for the company that subsequently bogged down in a wide-ranging scandal.

Documents obtained by Cause of Action through a Freedom of Information Act request indicate Obama considered attending the rollout of GreenTech Automotive’s first electric car. McAuliffe was the chairman of the company, but quietly resigned in December 2012.

GreenTech is currently embroiled in a scandal over the company’s EB-5 visas. (RELATED: Virginia lawmakers pressure McAuliffe over GreenTech scandal) The Washington Free Beacon recently reported there is no evidence GreenTech has produced any cars, green or otherwise.

“GreenTech Automotive, a Chinese-funded EB-5 project, is rolling out its first electric car at their pilot plant in Horn Lake, Mississippi… President Bill Clinton’s attendance has been confirmed by GreenTech, whose brother-in-law Tony Rodham is President & CEO of the EB-5 regional center Gulf Coast Funds Management, LLC which facilitated the project. President Obama has been invited and there is a chance that he will attend,” according to an April 2012 memo the Mississippi Development Authority sent to Mississippi governor Phil Bryant.

The event took place in July 2012, with Bill Clinton in attendance.

But the company bypassed Mississippi’s legal process in buying up land for the factory in 2011.

The Tunica County Economic Development Foundation, a group in Mississippi headed by Tunica County Chamber of Commerce president and CEO Lyn Arnold, worked out a strategy to secure land for GreenTech without going through the proper legal approval process.

“The county is preparing to purchase the 100 acres for GTA and close by 9/9/2011,” Arnold wrote in a September 1, 2011 email providing “an update on GTA from the Tunica perspective.”

“The land will actually become the property of the Tunica County Economic Development Foundation (my organization). GTA will have full use of the land even to the point of pledging the land for additional financing. Once the facility is constructed and employment reaches 350, the land will be fully transferred to GTA. The only way the deal is structured this way is without special legislation, this is the only legal way a county can provide land to benefit a private company,” Arnold wrote.

“I have been speaking with Charlie regularly, mostly about the EB-5 applications and getting those approved by US Customs and Immigration. USCIS has stalled us at every opportunity, but along with Senator Wicker’s office and Congressman Thompson’s office, we are hopefully moving those approvals along,” Arnold wrote.

Sec. 31-7-13 of the Mississippi Code requires a strict bidding procedure for land purchases over $15,000, mandating a published notice of the sale and requiring competition for a winning bid. As Arnold’s email demonstrates, GreenTech obtained the land from the Tunica County Economic Development Foundation without making a competitive bid.

McAuliffe’s GreenTech scandal is gaining heat as the Virginia gubernatorial race progresses.

U.S. Citizenship and Immigration Services (USCIS)  director Alejandro Mayorkas is currently under federal investigation for helping an investor in Gulf Coast Funds Management, run by Hillary Clinton’s brother Anthony “Tony” Rodham, receive an EB-5 visa, which grants conditional permanent residence to foreign nationals who invest significant amounts of money in the United States. The investor’s application had already been denied by the time Mayorkas became involved, and an appeal had already been shot down.

Mayorkas acknowledged that he met with McAuliffe, a business partner of Rodham, to generally discuss the USCIS visa application process, which McAuliffe complained was too slow.

“I was asked to attend a meeting with Mr. McAuliffe so that I could hear in person his complaints… I heard those complaints, and that was the extent of the interaction,” Mayorkas said.

Gulf Coast Funds Management handles EB-5 visas for investors in GreenTech Automotive, of which McAuliffe is chairman. GreenTech reportedly relies on EB-5 visas for its investors.

McAuliffe and Rodham took a fishing trip together in April 2013 to celebrate the launch of GreenTech’s MyCar electric vehicle, where they were photographed together.

The McAuliffe campaign, Gulf Coast Funds Management and Lyn Arnold did not return requests for comment.

Dan Epstein on WFLA 4/26/2013

Executive Director Dan Epstein discusses CPPW report on WFLA

5 Ways the DOE Loan Program and Fisker Automative Failed American Taxpayers

The House Oversight Committee is holding a hearing today on “Green Energy Oversight: Examining the Department of Energy’s Bad Bet on Fisker Automotive.

We’ll be live tweeting beginning at 2pm.

1. According to the DOE Loan Program Office, $34.5 billion of loans have created about 60,000 jobs, which is $575,000 per job.


Via Tumblr

2. Cause of Action analysis determined that 95% of those who received a loan gave political contributions, while only 31% of those who were not chosen gave contributions.


3. Fisker Automotive continued to receive money for almost a year after the Obama administration found out it was failing to meet conditions set in the loan.

 In 2010, the Obama administration gave a $529 million loan to Fisker. Fisker would only receive $192 million before it was cut off.

Via Gifrific

4. Fisker never finished construction on its factory or produced any cars backed by the government loan.

 Via togif

5. Taxpayers are looking at a potential loss of $171 million. The largest loan failure since Solyndra.





Dan Epstein on Radio America 4/20/2013

Executive Director Dan Epstein on Radio America discusses the CPPW report.

Senator Unveils “Victims of Government”

Senator Ron Johnson has released “Victims of Government”; a project dedicated to exposing the unintended consequences of federal regulations.

The Small Business Administration Office of Advocacy estimates that it costs Americans $1.75 trillion to comply with federal regulations each year.  To put $1.75 trillion into perspective, that amount is larger than all but eight economies in the world.  It also means that over 10% of the U.S. economy is spent on trying to satisfy rules issued by Washington bureaucrats. That doesn’t even include federal, state, and local taxes.

This heavy regulatory burden diverts resources from innovation to compliance, discourages business investment, and chills job creation. It is no accident that as Washington adds new regulations, more and more Americans are unemployed and underemployed.

Elected leaders need to carefully consider the costs and negative unintended consequences of unnecessary federal regulations.  They need to remember that real people must comply with these regulations and that making them overly burdensome stifles American growth.  This blog features just some of the victims of government.

According to the study commissioned by the Small Business Administration Office of Advocacy, “had every U.S. household paid an equal share of the federal regulatory burden, each would have owed $15,586 in 2008.”

Cause of Action is well aware of how the federal government can clamp down on economic opportunity. We represent Drakes Bay Oyster Company; a small, family-run, sustainable oyster farm located in Point Reyes National Seashore in a lawsuit against the Department of the Interior (DOI). DOI is using bad science to make false claims about the oyster company’s impact on the environment. If Interior succeeds, 30 jobs would be destroyed, and 40 percent of California’s oyster market would disappear. Most recently, Drakes Bay Oyster Company has been granted an emergency Injunction pending appeal keeping the farm open until the 9th circuit rules on DBOC’s injunction appeal.