More Obama Corruption ~ The Crooked Chicago Private Equity Fund

Wonder where a lot of Obamanation's money is coming from? Crooked unions. And that's why he's trying so desperately TO CREATE MORE UNIONS, and the ones we have, make them stronger. Read this story and it'll all come crystal clear.

And remember this is just a tip of the corruption iceberg with the lunatic fringe that are now ruling in our White House.

And why, oh WHY is this not being reported on the main stream media?? Huh?

Aw well, here is the article:

OutFront
Why Several Unions Invested in One Fund
Daniel Fisher, 07.15.09, 06:00 PM EDT
Forbes Magazine dated August 03, 2009

Why did so many unions invest in a crooked Chicago private equity fund? And why does this keep happening?

There's not much mystery about why the Detroit branch of the United Brotherhood of Carpenters invested $77 million in a crooked Chicago "private equity" fund called AA Capital a few years ago. AA Capital's cofounder, John Orecchio, bribed the union's former executive secretary-treasurer Walter R. Mabry, according to a recent federal indictment of a third man allegedly involved in the scheme. (Orecchio himself wasn't indicted.)

That doesn't necessarily explain why Millwrights Local 1102 wired $8.3 million of its $150 million pension fund to the same crooked fund, however. Or why International Operating Engineers Local 324 and the Michigan Teamsters Joint Council 43 also invested with AA Capital.

All told, six regional union funds entrusted $164 million with Orecchio, a former ABN Amro investment banker, between 2002 and 2005. Orecchio allegedly blew much of the money on personal expenditures, Super Bowl tickets, a Detroit strip joint he owned and a disastrous investment in a sport-drink company affiliated with the Ultimate Fighting Championship franchise owned by the Fertitta brothers of Las Vegas.

Merrill Lynch was a financial advisor to several of the unions and has been accused by the Millwrights of promoting AA Capital. Merrill denies the charges and says the union trustees insisted on investing in AA Capital.

The bigger question: Why does this keep happening to union pension funds? And why doesn't it happen to funds for union officials, which are separate from those the officials run for the rank and file?

Take the Operating Engineers. The pension fund for top officials in its Washington headquarters has $85 million for 401 participants, or $209,000 apiece. It is 108% funded. Local 324's $1.4 billion rank-and-file fund has 18,000 participants, or $79,000 per head, and is 81% funded. Some of the difference can be explained by boneheaded investments like the $60 million Local 324 put into AA Capital or the $28 million it sank into rebuilding a Detroit office building that it sold for $4.5 million in 2004.

None of the unions would discuss their investment in AA Capital, so it isn't clear how they all came to believe in Orecchio's abilities as a private equity manager. Orecchio, who recently attempted suicide, did not respond to calls made to his attorney for comment. In court filings he has acknowledged having caused $60 million in losses. Mabry was sentenced to jail on unrelated felony charges in 2006.

The Carpenters first invested in AA Capital in 2002, when Orecchio had a deal to develop a Hard Rock casino in Biloxi, Miss. In its lawsuit against Merrill Lynch, the Millwrights union, which is associated with the Carpenters union, says a Merrill senior vice president promoted AA Capital. Orecchio, in turn, is accused of plying Merrill's brokers with entertainment, including lap dances by strippers. Merrill says it didn't advise the unions to invest in AA Capital and made no fees or commissions from it.

The Hard Rock investment was profitable only because Hurricane Katrina wiped out the site. [read that again in case it didn't sink in ... and remember who (ACORN) is headquartered there] According to the May 28 indictment of Joseph R. Jewett, a "consultant" allegedly hired at the insistence of Mabry, the union boss got a $267,000 payoff that he rolled into other AA Capital investments. Jewett denies the charges.

Next, the Carpenters and the Operating Engineers invested through AA Capital $32 million in Xyience, the ufc-sponsoring sport-drink company run by a twice-convicted felon named Russell Pike. The outfit ended up in bankruptcy. A receiver recovered about $9 million.

Union members wouldn't know anything about these shenanigans if they hadn't erupted into litigation and a federal indictment. And if the Obama Administration has its way, even some of the limited disclosure forms that require officials to reveal their ties to investment managers and the purchase and sale of assets will be dialed back. It would "not be a good use of resources," the Administration said.

"Can you imagine the IRS saying requiring tax returns is not a good use of resources?" asks Elaine Chao, labor secretary in the Bush Administration. "These are disclosures that potentially would deter embezzlement." [i.e. Obama won't allow them to be prosecuted]