By Ray Stern
By Ray Stern
By New Times
By Amy Silverman
By Stephen Lemons
By Stephen Lemons
By Monica Alonzo
By Chris Parker
The filing is Symington's attempt to liquidate his debts rather than reorganize them and set up a payment schedule, as he could have done under other portions of the bankruptcy code. Symington's bankruptcy filing was delayed for years, largely because the governor was able to vigorously defend against lawsuits that the pension funds had filed against him. That protracted defense was carried out by lawyers from the state's largest law firm, Snell & Wilmer.
It is unknown how much Symington has paid or owes Snell & Wilmer. The governor stated in his bankruptcy filing that his debts to his lawyers and his accountants are "unknown."
These "unknown" debts raise questions about whether Symington has used political power to benefit some of his creditors.
For example, three Snell & Wilmer attorneys have landed key positions in state government since Symington took office. The appointments include: Mary Leader, executive assistant for health and human services; Rita Pearson, head of the Department of Water Resources; and former head of the Department of Environmental Quality Ed Fox.
The governor's accountants, Coopers & Lybrand, were awarded more than $4.5 million from two state contracts related to Project SLIM. Coopers & Lybrand was forced to repay $725,000 from the first contract to end an attorney general's investigation into possible bid-rigging. The second contract has also raised questions; state records appear to document Symington's involvement in steering work to Coopers ("How Fife's Friends Got Fat on Project SLIM," March 16).
Lawyer and accountant fees are not the only mysteries of Symington's bankruptcy filing. Officials with union pension funds say they want these key questions answered during the bankruptcy proceeding: ù Are Ann Symington's extensive assets--reportedly in the millions of dollars--available to creditors? After all, the governor listed community assets of more than $12 million on at least two financial statements.
ù What is the value of Symington's four trust funds? The governor claims they are worth less than $1 million. The pension funds want to see proof, and they also want to explore tapping the trusts to pay off creditor claims.
ù What is the explanation for Symington's sudden change in net worth? How could he suffer a $35 million swing in 11 months, from a positive $12 million to $23 million in the hole?
ù Did the governor transfer assets to his wife before filing bankruptcy?
ù How did the governor pay off $1.2 million in loans his wife and mother made to his campaign in 1990? During that time period, the governor told pension fund officials he was broke.
ù How closely do Symington's financial disclosure statements, filed annually with the secretary of state, correspond with personal financial statements submitted to pension fund officials and other creditors? (The 1991 financial statement Symington submitted to the state shows a positive equity in his real estate projects; in May 1991, Symington told pension fund advisers he was $23 million in the red.)
ù What happened to a $300,000 commission Symington received in 1994 from the sale of the Esplanade, another failed Symington real estate project? The bankruptcy filing suggests it is already gone. But gone where?
If the pension funds or other creditors can show Symington fraudulently or illegally obtained loans, there is a possibility the debts could be excluded from Symington's bankruptcy. Such debts would continue to follow the governor indefinitely.
"We don't see this as over," says pension fund attorney Keith Overholt. "There are still a lot of things we can do."
Creditors aren't the only ones interested in the fine print contained in Symington's bankruptcy filing.
A federal grand jury is continuing a criminal probe of Symington's finances that began more than two years ago. Sources familiar with the investigation say the grand jury is piecing together answers to many of the questions creditors have been asking about Symington's finances, and about possible shifts of assets to his wife.
Much is still unclear about the grand jury probe. It has not been disclosed whether that panel is examining the roots of the Mercado loan, or the legality of the $10,000 "loan processing fee" paid by Symington's partnership to Miller.
In a civil suit against Miller, pension fund lawyers alleged the payment violated federal law. Miller's acceptance of similar payments from real estate broker Keith Dolgaard helped land both men in federal prison.
But are prosecutors examining loan commitment documents signed on October 15, 1987, by William Earle Miller, now an imprisoned felon, and J. Fife Symington III, now a bankrupt governor?
At this point, anyone outside of federal law enforcement can give only one truthful answer to that question: unknown.