WASHINGTON, D.C. — On Monday, the Campaign for Accountability (CfA) filed a second complaint with the Securities and Exchange Commission and the Senate Select Committee on Ethics, alleging that Sen. Robert Corker (R-Tenn.) concealed information about his stake in several hedge funds — funds managed by his campaign donors – in violation of federal law and Senate rules.
Micah Johnson, communications director for Sen. Corker, vigorously denied the allegations in a Thursday response.
“This is yet another baseless accusation by this political special interest group,” Johnson said. “These claims are categorically false and nothing more than a smear campaign. When amending the senator’s financial disclosure report, our office worked directly with the Senate Ethics Committee to ensure items were reported accurately and in line with Senate guidelines.”
In the Monday press release, CfA Executive Director Anne Weismann commented, “Authorities should investigate why Sen. Corker was so intent on hiding the underlying assets of these funds that he filed inaccurate disclosure forms year after year.”
Between 2013 and 2015, CfA states that it appears Corker failed to disclose the underlying assets in at least six hedge funds in violation of Senate rules and may have failed to disclose at least $2 million in income from the funds.
Senate ethics rules require members to disclose the underlying assets in funds that do not qualify as Excepted Investment Funds (EIFs).
One of the EIF qualifications is that a fund must be widely diversified, meaning it must have over 100 investors.
According to the CfA, Corker invested in funds managed by three Tennessee-based firms: Gerber/Taylor Management Company, TSWII Management Company and Pointer Management LLC.
In some cases, letters written by Gerber/Taylor that Sen. Corker submitted to the Senate ethics committee appear to confirm that not all of the funds in which the senator invested had more than 100 participants. In other cases, forms submitted by the hedge funds to the SEC, reveal the funds had fewer than 100 investors.
Since 2004, the top employees of Gerber/ Taylor, TSWII, Pointer, and their families have donated $204,020 to Sen. Corker’s Senate campaigns and $75,000 to his leadership PAC, according to CfA.
The founder of TSWII, L. H. Caldwell III, was among the co-chairs of Sen. Corker’s campaign committee ahead of his 2006 election. Since 2004, Caldwell and his family have donated $73,280 to Sen. Corker’s campaigns and $20,000 to his leadership PAC.
Caldwell’s three younger children made 13 contributions to Sen. Corker’s campaigns between December 2004 and March 2011. The occupation of the children reported to the FEC for these contributions was “student” and the address provided was for the Caldwell family home in Lookout Mountain, Tenn., even when they had jobs and lived elsewhere. The CfA noted that this raises questions about whether Caldwell was the real donor.
First complaint
In November, the CfA filed a complaint alleging Corker may have engaged in insider trading and made false statements on his personal financial disclosure forms. The complaint states that Corker made 70 trades of stock (and that many were not disclosed) in a real estate investment company, CBL & Associates Properties.
The CfA complaint alleges that some of Corker’s trades of CBL stock closely preceded company announcements that led to changes in the stock’s price and seemingly resulted in the senator making millions of dollars. CBL employees have been major contributors to Corker’s campaigns, and Sen. Corker previously had a business relationship with a CBL affiliate.
Read the full complaint at bit.ly/CfA-on-Corker.
CfA is a nonprofit watchdog organization that uses research, litigation, and aggressive communications to expose misconduct and malfeasance in public life and hold those who act at the expense of the public good accountable for their actions.
