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Bevin blasts reports tying him to support of bailouts

Bevin blasts reports tying him to support of bailouts

by Joe Arnold


Posted on February 12, 2014 at 6:15 AM

Updated Wednesday, Feb 12 at 6:21 AM

LOUISVILLE, Ky. (WHAS11) -- Seemingly caught in a contradiction over his past and present opinions about federal bailouts of banks and mortgage giants, U.S. Senate candidate Matthew Bevin denied Tuesday that he had ever expressed a favorable view of the controversial policies, despite a document with his signature which suggested, otherwise.

"I have never... and there is not a person anywhere that can provide one scintilla of evidence that I was ever anything but opposed to this, ever," Bevin told WHAS11.

Bevin's criticism of Senate Minority Leader Mitch McConnell's role in the bailouts has been a central theme of his Republican primary challenge against McConnell in Kentucky's 2014 U.S. Senate race.

Yet, as first reported by Politico on Tuesday morning, a 2008 prospectus for the Veracity Small Cap Value Fund mutual fund co-signed by Bevin as Veracity's president, and Daniel Bandi, the fund's chief investment officer (CIO) expressed support for the federal intervention:

"Most of the positive developments have been government led, such as the effective nationalization of Fannie Mae and Freddie Mac, the passage of the $700 billion TARP (don't call it a bailout) and the Federal Reserve's intention to invest in commercial paper. These moves should help to stabilize asset prices and help to ease liquidity constraints in the financial system."


"Matt Bevin's entire campaign is based on a lie," said McConnell campaign spokeswoman Allison Moore, "as he has been untruthful on everything, from where he went to school, to his business background, to where he stands on the issues and he has been exposed."

"These are not my words," Bevin told WHAS11 on Tuesday. "People are quoting someone else's words and putting them in my mouth and people are reporting on it as fact."

Bevin explained that while the mutual fund's CIO, Daniel Bandi, authored the message to investors, Bevin's signature alongside Bandi's at the bottom of that message never signaled any agreement with Bandi's opinions.  Instead, Bevin said his own signature, as President and Chairman of the Board of Veracity Funds, merely confirmed the accuracy of the dollar figures included in the document.

The document, however, does not make any distinction to investors between Bandi's and Bevin's opinions.

"It was always written and only written by the Chief Investment Officer," Bevin said.  "So he was the one who would write that letter, talking about what worked and did not work, and that's the letter that everybody is hung up on."

WHAS11 asked Bevin about a number of media reports on Tuesday which suggested Politico's publication of the mutual fund document revealed hypocrisy by Bevin and would serve as a crippling blow to his campaign.

"It would be if I had written those letters," Bevin acknowledged, "I would agree with that thought.  But, it literally, it is so far from that, it is so devoid of any basis of reality that it's hard for me to...it doesn't concern me other than the fact if people are so simplistic to believe something that they refuse to do their own homework on it, then I guess perception can become reality.  That's what (McConnell's) hoping."

Reading from the Politico article during MSNBC's "Morning Joe" program Tuesday morning, host Joe Scarborough referred to Bevin as a "snake oil salesman," predicting the story would have a "devastating impact on Bevin's campaign."

Bevin suggested the McConnell campaign fed the story to the cable network.

"Really? MSNBC?" Bevin scoffed.  "Why? Because he knows they'll breathlessly run with this stuff and Politico and some of these people who are read inside the Beltway.  And what he counts on is that once enough of them jump on, that those of you back here in Kentucky that people do pay attention to will just assume it's already a given because, 'Well, all those people are agreeing.'"

The McConnell campaign argues that because the word, "we" is used throughout the mutual fund's November 4, 2008 semi-annual report to stockholders, Bevin cannot claim that he was not responsible for the letter and its contents.

Yet Bevin claimed just that, comparing his relative responsibility for the content of the document's message to the responsibility of a newspaper subscriber for the content of a newspaper article. 

"It's a very highly regulated business," Bevin said.  "The idea that because I signed a prospectus that I am endorsing the opinion of an investor who is making decisions that I have no control over, is insane."

Bevin recalled expressing disdain for the Troubled Asset Relief Program (TARP) as it was being formulated, during a meeting between Boeing Corporation and investment managers of the company's retirement assets.

"I said, 'This is going to turn out to be a big stinking, rotting corpse that the people are going to pay for in ways that they are not anticipating because they are being whipped into a little panic right now,'" Bevin said.

"I was the only person who saw it for what it was," Bevin continued, "or, who was willing to say as much."

Bevin said he did not regret any disconnect between Bandi's positive review of the effect of bailouts and Bevin's opposition to them.

"No," Bevin said, "because he was making what he believed to be the best decisions based on the lay of the land as an investor in the way in which he was investing in financial security."

"In reality, if you read what he wrote, he was talking about how this was advantageous for financial security," Bevin told WHAS11.  "There's some truth to that. In reality, they did benefit, and the stock market has gone up like a rocket in large measure since that time, and quantitative easing, to boot, is another version of it."

"Whether a person agrees with the premise of how these two came into existence, their intended effect on the market has been true, and indeed it has worked," Bevin continued.  "His job was to focus not on whether he even agreed with these things or not from a premise standpoint, but whether there's going to be value-added as an investor.  That was his job."

The revelation comes four says after a WHAS11/Courier-Journal Bluegrass Poll showed McConnell with a 26 lead over Bevin in the GOP primary, yet trailing Democratic candidate Alison Lundergan Grimes by four percentage points in a fall election match-up.  Fifty percent of registered voters surveyed in the poll, conducted by veteran pollster Survey USA, had an unfavorable view of McConnell.

"Do you think it's a coincidence that these things pop up every time there's a survey or something where McConnell is clearly increasingly less likely to keep his seat?" Bevin said.  "Who do you think feeds these?  Who do you think goes digging through those prospectuses and then feeds them to people that he knows are not going to do any homework?"

Bevin said the McConnell campaign's attacks on his background have been ineffective, including criticism of Bevin's online LinkedIn account which until last year intimated that Bevin had attended the Massachusetts Institute of Technology.  In actuality, Bevin had attended a three-week seminar on the MIT campus. 

"Maybe that one's running its course," Bevin said.

The McConnell campaign has characterized as a "bailout" taxpayer subsidies received by Bevin's family's Connecticut bell factory to rebuild after a devastating fire. 

It has also criticized Bevin for $116,000 in tax liens assessed against the bell company.

"The tax thing never really stuck," Bevin said.

"I wouldn't have - for the life of me - stepped into this arena if any of this stuff was true," Bevin said.  "None of it is true.  I've lived the most squeaky clean life in terms of this kind of stuff."

The latest bailout story firestorm may backfire on McConnell, Bevin suggested.

"It's from a guy who says TARP was the finest hour in Senate history," Bevin said, "and now he's attacking me supposedly for being a supporter of something that he's been the ultimate champion of."

"He's running the risk, he's getting closer and closer to the edge," Bevin said, "and he'll have his 'Aqua-Buddha moment, mark my word."

In 2010, Democratic U.S. Senate candidate Jack Conway released a now infamous campaign ad questioning Republican candidate Rand Paul's religious views after GQ magazine published an article detailing an apparent college hazing incident where Paul and a friend forced a fellow student to worship the "Aqua Buddha."
Bevin said that McConnell "will eventually go one step too far."