First off, let me say that I have no personal grudge against Jim Gilmore. I happen to like his campaign manager Dick Leggitt. Dick ran the media in my 1995 race.
I do however have some significant concerns about Gilmore’s record and his viability as our Party’s nominee for the US Senate. A few of my readers have left some pretty spiteful comments after reading my post from last week. We are vetting a candidate and I am just participating in that process. And I see no reason to back off.
The press release issued by Gilmore to defend himself was pathetic.
1) Everquest was not a subsidiary of Bear Sterns - True. But it was 60% owned by Bear Sterns.
2) Everquest doesn’t market securities - Everquest was created to move bad investment CDOs off of Bear Sterns’ balance sheet and on to the new company, Everquest. Stock would then be sold in Everquest. When the investments went bad, it would be Everquest shareholders, not Bearn Sterns that would suffer the consequences.
3) Primary Everquest holdings were sound corporate loans – Not so. The holdings were sub prime mortgages that were a high risk of default going into 2008.
4) Everquest is not a hedge fund – True. Everquest was created to take on the risky debt of hedge funds controlled by Bear Sterns.
5) Everquest is thriving – It’s a not a publicly traded company so we have no way of knowing how well it’s doing.
Points 6-8 are political in nature and were responses made to a political reporter. They have nothing to do with this issue.
Barclay’s filed a civil suit against Everquest in December 2007. SEC investigations are sure to follow and heads will role.
Again, the question is why would Jim Gilmore be involved in something like this? I think it’s because this was an easy, non-time consuming job. We can assume he would receive a significant salary as Chairman, but he’s not running day to day operations.
And Jim has done this before. He took a job at a Richmond law firm when he was running for Governor in 1997, knowing he wouldn’t have to actually “work” for the firm.