Posted on 02/15/2009 1:40:18 AM PST by genghis
California Congresswoman discovers get-rich-quick schemeposted at 9:15 am on February 14, 2009 by Ed Morrissey Send to a Friend | Share on Facebook | printer-friendly People who wonder how elected officials come to Congress on modest means and retire wealthy should study Rep. Grace Napolitano of California. Few have found campaigning as personally enriching as Napolitano … literally. And according to the FEC, her scheme is apparently completely legal: During a decade in Congress, California Representative Grace Napolitano has pocketed more than $200,000 of political contributions by charging as much as 18 percent interest on money she loaned to her own campaign. The suburban Los Angeles Democrat made the $150,000 loan in 1998, when she was first elected to the U.S. House of Representatives. Through Dec. 31, her campaign committee has used donations to pay Napolitano $221,780 of interest while reducing the principal by just $64,727, a review of her Federal Election Commission filings shows. As recently as June 2008, Napolitano held a fundraiser asking supporters and political action committees for money to pay down the 1998 debt. Napolitano, her spokesman and her campaign’s lawyers didn’t respond to requests for comment. Here’s how it’s done: Withdraw money from a pension or tax-protected savings account to justify charging yourself an interest rate that would make most credit-card companies blush. Pay only the interest as long as possible on the loan. Hold fundraisers specifically to retire the debt you owe to yourself, and make sure donors understand exactly where that money goes. Give yourself all the donations from those fundraisers. Once you have that system established, it allows contributors to stuff money into your pockets as long as the loan remains outstanding. At 18% interest, that could go on for decades, and in Napolitano’s case, she already has one decade on the books. Napolitano has managed to keep more than half of the debt alive as principal while earning almost 150% just on interest payments — and at this rate, she could do this for another twenty years. The best part of this is what Napolitano converted to create her donor-funded ATM. She worked as a secretary for Ford Motor Company, and cashed out stock at $45 a share in 1998 out of her retirement account. It’s now trading at less than $2 a share, and she’s had a 150% return in ten years without risking the principal at all. And she’s done it while giving contributors a direct line to her checking accounts — and it’s all legal. But it still stinks. Update: I didn’t play Name That Party, and thankfully neither did Bloomberg. It’s in the second paragraph of the news story: she’s a Democrat
Wow! Hillary better hear about this. She still owes herself eight million.
She learned well from one of her relative’s, Vito “The Vig” Napolitano.
What a great scam, I wonder how many others are working it?
These are the folks we have making our laws and shoving taxes up our backsides.
Criminals all.
You can be sure they all do it.
When it comes to self enrichment there are no party lines.
Now question #2: has she been reporting this interest income on her tax returns? Or maybe, it’s question #3 after: has she been filing her tax returns?
Three little words: culture of corruption.
Now you never have to wonder why they are always screaming about Republican corruption: projection.
Pssst… Wanna Become A Loan Shark? Run for Congress! Rep. Grace Napolitano Did…
BTW, are these Hillie's PUMAs?
And if so, wonder if Barry knows his SecState's PUMAs are still around...?
since this is a personal loan to herself how can she get away with violating the usury laws.
since this is a personal loan to herself how can she get away with violating the usury laws.
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