Posted on 05/02/2009 3:58:06 PM PDT by fiodora
A leading bankruptcy attorney representing hedge funds and money managers told ABC News Saturday that Steve Rattner, the leader of the Obama administration's Auto Industry Task Force, threatened one of the firms, an investment bank, that if it continued to oppose the administration's Chrysler bankruptcy plan, the White House would use the White House press corps to destroy its reputation.
The White House said the story was false.
"The charge is completely untrue," said White House deputy press secretary Bill Burton, "and there's obviously no evidence to suggest that this happened in any way."
Thomas Lauria, Global Practice Head of the Financial Restructuring and Insolvency Group at White & Case, told ABC News that Rattner suggested to an official of the boutique investment bank Perella Weinberg Partners that officials of the Obama White House would embarrass the firm for opposing the Obama administration plan, which President Obama announced Thursday, and which requires creditors to accept roughly 29 cents on the dollar for an estimated $6.8 billion owed by Chrysler.
Lauria first told the story, without naming Rattner, to Frank Beckmann on Detroit's WJR-AM radio.
Perella Weinberg Partners, Lauria said, "was directly threatened by the White House and in essence compelled to withdraw its opposition to the deal under the threat that the full force of the White House press corps would destroy its reputation if it continued to fight. That’s how hard it is to stand on this side of the fence."
Perella Weinberg Partners, which owned Chrysler debt through its Xerion Fund, was one of Lauria's clients in this bankruptcy, but no longer is. Before the Thursday deadline, Joseph Perella and Peter Weinberg tried to join the larger creditors -- JP Morgan Chase, Citigroup, Morgan Stanley, and Goldman Sachs -- who are owed roughly 70% of Chrysler's debt and had already agreed to participate with the administration's plan.
All four financial institutions are recipients of up to $100 billion in federal government bailout funds, though the Obama administration insists the matters were kept completely separate.
Officials of Perella Weinberg Partners could not be reached for comment.
Lauria said his clients "are mainly fiduciaries for pension plans, college endowments, retirement plans and credit unions who invested in low yield supposedly very secure first lien debt" with Chrysler.
President Obama singled out Lauria's clients for criticism when he announced the Chrysler plan on Thursday.
"While many stakeholders made sacrifices and worked constructively, I have to tell you some did not," the president said. "In particular, a group of investment firms and hedge funds decided to hold out for the prospect of an unjustified taxpayer-funded bailout. They were hoping that everybody else would make sacrifices, and they would have to make none."
Lauria said the president's assertion that his clients weren't willing to make any sacrifice is false. The clients were willing to take 50 cents on the dollar from Chrysler for their debt, he said.
President Obama also said of Lauria's clients, "I don't stand with them. I stand with Chrysler's employees and their families and communities. I stand with Chrysler's management, its dealers, and its suppliers. I stand with the millions of Americans who own and want to buy Chrysler cars. I don't stand with those who held out when everybody else is making sacrifices."
"He stands my clients up as basically the reason Chrysler is going into bankruptcy," Lauria said. "He wrongly says they're not willing to make any sacrifice. And then he says he does not stand with us."
Lauria said the president saying he doesn't stand with his clients "kind of sounds like 'You're fair game.' In whatever sense. People are scared. They have gotten death treats. Some have been told people are going to come to their houses. God forbid if some nut did something, I'm just wondering how the president would feel."
The Miami area-based attorney describes himself as an independent, and says after waiting in line for six hours last November he ended up not voting in the presidential election. He donated $10,000 to the Democratic Senatorial Campaign Committee in 2008 and $1,000 to then-Sen. Hillary Clinton, D-NY, in 2006.
-- jpt
The Thug In Chief in action.
These people will get away with this for a while but I believe there will be tons of class action suits to come out of this entire Tarp and Auto bailout. I think that before its over these people will be the ones going on trial from subverting the constitution.
bttt
Who ya gonna believe?
And it’s only been 100 days. Feels more like 100 yers.
Well, somebody’s lying, and I’ll take Lauria’s word over anyone in the POS Soetoro administration anytime.
LOL. We now have a Baghdad Bill to match the old Baghdad Bob.
WOW! Thanks for the link.
LEVIN IS RIGHT, this story NEEDS TO GET OUT!!!
What’s really going on?
LOL People haven’t figured out the vindictiveness of this administration yet?
Obama and his henchmen are all about getting even with those that dare question or disagree with the Messiah.
Many have already been targets of attacks by the left wing smear machine...
I wouldn’t be surprised if the IRS was specifically sent to audit all Conservatives tax returns for the last 3 years.
Remember its public record which party you belong too and which politicians you support with donations... stand by for recriminations for your bitter, antipathy towards Obama’s socialist utopia.
Brother & Sister.
Wouldn't you?
Of course it is!!
"'...and there's obviously no evidence to suggest that this happened in any way.'"
Of course there's not!!
And besides the seriousness of the charge isn't very serious either, eh? :o)
The Failures of Obama’s Auto Bailout Adviser
Steven Rattner’s shameless gladhanding has finally paid off: The New York Times-reporter-turned-financier will advise the Obama administration on the auto bailout. His Quadrangle Group’s record should give Detroit pause.
Chalk the high-powered DC escape up to Rattner’s “momomaniacal... social climb[ing],” as one of his colleagues once put it: He raised “large sums” for John Kerry and helped convince 200 business leaders to endorse him; he was a fundraiser ($2 million) and “enthusiastic supporter” of Hillary Clinton. Then he launched a campaign to raise $1 million for Obama from former Hillary supporters.
Given his tight business and personal relationship with Times publisher Arthur Sulzberger Jr. and his purported ability to suppress news about his wife’s drunk driving — the DUI was no barrier to an Obama job, as it turned out — perhaps it makes sense that the truth about Steven Rattner is the one you hear on background.
http://gawker.com/5159212/the-failures-of-obamas-auto-bailout-adviser
Meaning "Steve called via an untraceable phone, so we know they've got no proof"
‘D.N.C.’s A.T.M.’ Steven Rattner Allegedly Under SEC Scrutiny in Kickback Scheme
The Wall Street Journal is reporting that the man lovingly referred to as the “D.N.C.’s A.T.M.,” by the New York Times is under scrutiny by the SEC in an alleged kickback scheme involving New York state’s pension fund. The pay to play scheme has already resulted in the arrest of a top political fundraiser in a “123-count state criminal indictment that included money-laundering, enterprise-corruption and bribery charges.”
Steven Rattner, the leader of the Obama administration’s auto task force, was one of the executives involved with payments under scrutiny in a probe of an alleged kickback scheme at New York state’s pension fund, according to a person familiar with the matter.
A Securities and Exchange Commission complaint says a “senior executive” of Mr. Rattner’s investment firm met with a politically connected consultant about a finder’s fee. Later, the complaint says, the firm received an investment from the state pension fund, then paid a $1.1 million fee.
The “senior executive,” not named in the complaint, is Mr. Rattner, according to the person familiar with the matter.
Tapper better stay off airplanes, get a food taster, and hire security for his home.
I believe it is a bottle of Woolite. You know, to get the blood stains out of their fine washables.
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