Whooopsie
Looks like Harry Reid might be in a bit of trouble.
Senate Democratic Leader Harry Reid collected a $1.1 million windfall on a Las Vegas land sale even though he hadn’t personally owned the property for three years, property deeds show.
In the process, Reid did not disclose to Congress an earlier sale in which he transferred his land to a company created by a friend and took a financial stake in that company, according to records and interviews.
Nice. I wonder how I can get in on a deal like that? Oh wait, I’m not a U.S. Senator, darn.
The Nevada Democrat’s deal was engineered by Jay Brown, a longtime friend and former casino lawyer whose name surfaced in a major political bribery trial this summer and in other prior organized crime investigations. He’s never been charged with wrongdoing _ except for a 1981 federal securities complaint that was settled out of court.
Yeah, I know, I know Jack Abramoff, Jack Abramoff, Jack Abramoff, and BushCheneyHalliburton!
In 2001, Reid sold the land for the same price to a limited liability corporation created by Brown. The senator didn’t disclose the sale on his annual public ethics report or tell Congress he had any stake in Brown’s company. He continued to report to Congress that he personally owned the land.
I wonder if the Jedi Mind Trick will work in this case. This cartoon from Cox and Forkum seems some what appropriate.
Uhhh, according to the story he transferred the land to an LLC in exchange for an interest in the LLC. I don’t think that counts as a sale (at least I know it doesn’t for tax purposes). Plus he paid $400,000 for it in 1998 and received $1.1 million for it (or the interest in the LLC) six years later in 2004, a profit of $700,000 over 6 years in, IIRC, the hottest real estate market in the country.
What smells here is (a) his associate dropping his name in the zoning debate (assuming Reid knew and approvied); and (b) his shoddy record keeping (jeebus harry, you’re a frickin’ Senator). This is not to excuse him for either of those but “$1.1 million windfall on a Las Vegas land sale even though he hadn’t personally owned the property for three years” is so misleading that it’s appalling.
Actually he did need to report lots of stuff.
And if you make no profit, no loss, and no money moves, what then?
And, FWIW, this had already been reported to the ethics committee according to Kos (I know, I know, I said FWIW).
And I keep seeing them use that word “sale,” AFAICT, there was no sale, either for state law or federal tax purposes. There may have been a sale for Congressional reporting purposes, and if he didn’t report it then he will receive whatever punishment the ethics committee gives him.
I think his co-proprieter dropping his name to change the zoning is worse and he deserves rebuke for that.
I know Jack Abramoff, Jack Abramoff, Jack Abramoff
Funny you mentioned it, because I remember Reid had a bit of an Abramoff problem as well…
If Reid has done anything illegal or unethical, he certainly should be held accountable.
Are you going to give equal time to this story? (from the Wall Street Journal):
Lawmaker Pushes Earmarks Near His Own Land
John R. Wilke writes on page one of the Journal today: Charles Taylor owns at least 14,000 acres of prime land in western North Carolina. He’s also the local congressman. So when he steers federal dollars to his district, sometimes he helps himself, too.
Last year, Taylor added $11.4 million to a big federal transportation bill to widen U.S. Highway 19, the main road through Maggie Valley, a rural resort town in the Great Smoky Mountains. His companies own thousands of acres near the highway there and had already developed a subdivision called Maggie Valley Leisure Estates. Taylor also got $3.8 million in federal funds for a park now being built in downtown Asheville with fountains, tree-shaded terraces and an open-air stage. It’s directly in front of the Blue Ridge Savings Bank, flagship of his financial empire. He is among the richest congressmen with assets of at least $72 million, records show.
The Republican lawmaker is one of at least a half-dozen House members whose public actions in directing special-interest spending known as earmarks have also benefited their private interests or those of business partners, according to congressional, corporate and real-estate records. Among them is a senior Democrat, Rep. Alan Mollohan of West Virginia.
The lawmakers say they’re working to help their districts, not themselves. “I fight for the priorities set by our local governments, universities and economic development organizations, not based on what will be of benefit to me,†Taylor says
Anjin, are you digging dirt? Let us look into the financial dealings of one John Murtha, or who works for Nancy Pelosi. Who, by the way, was seen standing next to a leader of NAMBLA at a San Francisco parade. Why do people like you try to draw attention away from the facts? The subject was Harry Reid, Senate Minority Leader, not some obscure congressman. Like Congressman Shays said, Hastert didn’t drive off a bridge, leave someone to die and have a press conference the next day. Democrats have no business pointing fingers at anyone. The Kennedy’s alone discount the dems on any morality issue.
Ragshaft,
Any public official who abuses his office should answer for it, regardless of party affiliation.
If your position is that only Democrats should be accountable, that is your right. It is also one of the reasons the GOP is about to become the minority party on the hill.
If you would prefer to rant about a tragedy from the 60’s to dealing with the problems of today, well…… nuff said.
an earlier sale in which he transferred his land to a company created by a friend and took a financial stake in that company
I’m a CPA and I’ll tell you that you either sell an asset or, as seems to be the case here, transfer an asset in an “exchange of like assets”. You don’t do both. A transfer is nothing more than a simple capital contribution to a business enterprise.
It appears Reid transferred the property into an LLC in exchange for a proportionate interest in the company. There is nothing unusual or unethical about that. The land was later sold at a profit. Nice going, Harry. That’s called capitalism. Unless you got something more than this, take a walk. Reid invested his money and made a profit. So what? If he screwed up the paperwork in his Washington disclosure forms, eh…
Oh teh noes! I hope she knows cooties are an airborn disease and was inoculated.
Interesting stuff. The questions I’d want to see are: did the LLC get the land at FMV, and how common were these sales? And did Reid have anything to do with the key to the deal, the vote by the county zoning to change the zoning from residential to commercial? I’m with Ugh on the rest of it; a swap of property for equity in an LLC, so long as the values are the same, isn’t such a big deal since LLC’s are all pass-through anyways (which is why it’s not so surprising that Reid claimed personal ownership)
LLC’s are all pass-through anyways (which is why it’s not so surprising that Reid claimed personal ownership)
That’s right. The LLC would not be liable for any taxes (unless it filed a tax return as a corporation, which it likely wouldn’t). It would issue a Form K-1 to Harry Reid personally, with a copy to the IRS, of course, and he would be liable for Federal income tax on the profit. The article stated the property was transferred to the LLC at its original cost, which would be the tax basis when the property is sold.
This whole article looks like a hit job. A “$1.1 million windfall”? What is that? If I was his accountant, I’d be looking at a $610 thousand capital gain, which would get preferential tax treatment, over seven years. I guess that’s a “windfall”. Nice profit but not extraordinary by Las Vegas real estate standards over the last seven years.
No more will come of this than came of the Hastert land deal back in June.
Does anybody really believe that these “lawmakers” don’t have lawyers who watch over these deals and ensure that every i is dotted and every t crossed?
This is nothing more than a blatant attempt to divert our attention from the Foley scandal and y’all know it. So just stop, okay? Ain’t gonna work.
Indeed. The amount gained can’t be out of the ordinary for the area that’s seen insane levels of the growth over the past decade.
Here’s a sidenote of interest.
Harry Reid is a LDS (Latter Day Saint/ Mormon) for those that don’t know what an LDS is.
As a member of this church, I can tell you that we Mormons are held to very high ethical standards.
(Please, no jokes about multiple wives, we don’t believe in polygamy)
These high ethical standards are “supposed” to govern our actions as we are to be a light upon the world.
I mention this because if he is a member in “good” standing, and is found to have some impropriety here, he can and should be excommunicated from the church.
I think being a member of the Senate AND an LDS member means you lead your life personally and professionally in a manner that exemplifies your faith.
Clearly, if these allegations are true, marks a turning point in Senator Reid’s spiritual career as well.
LOL! Great irony there, Len.
Uh, you were being ironic on purpose, right?
Yet nothing on hasters prairie parkway deal…do you really want to try and get into an ethics match at this point….it seems 30 year old car accidents are your only reference…no recent mistress stranglers or child abusers?
I wonder if this deal is realted to this story from the LA Times on August 20th about Coyote Springs Valley:
Nick, I have to pick some nits with you.
These high ethical standards are “supposed†to govern our actions as we are to be a light upon the world.
Perfectly true, and completely unremarkable. I don’t think any Christian group feels otherwise, and the tone here will likely rub them the wrong way. We sometimes forget that we are expressly forbidden to be self-righteous.
I mention this because if he is a member in “good†standing, and is found to have some impropriety here, he can and should be excommunicated from the church.
Conviction of felony is normally prima facie cause for excommunication from the Church. However, if some of the comments here are to be believed, no felony was committed.
It’s been some time since I served in a bishopric, so I haven’t seen the latest edition of the Church Handbook of Instructions; but the old version stated that technical violations of complex regulations, arguably arising from the the difficulty of understanding and complying with said regulations, are not necessarily grounds for Church discipline.
I don’t recall any discussion in the Handbook of the ecclesiastical consequences of violating Senate rules.
We don’t know all the facts, but from what I’ve heard so far, there’s a good chance that there’s no grounds for Church disciplinary action.
(Please, no jokes about multiple wives, we don’t believe in polygamy)
It would be more accurate to say that we believe God has withdrawn His permission for anyone to have more than one living spouse. A fine distinction, perhaps.
I think being a member of the Senate AND an LDS member means you lead your life personally and professionally in a manner that exemplifies your faith.
I absolutely agree. But I distrust politicians enough that I cringe at the thought that anyone would judge our faith by the actions of an LDS politician.
I doubt serious members of any other faith feel otherwise about their politicians.