Thursday, December 29, 2022

Holidaze Week: Fantasma Santos, Con't

Constantly consistently, and pathologically lying about his resume and his background, GOP Rep-elect George Santos is in increasing amounts of trouble. He refuses to resign, and his MAGA troll defenders are screeching that the only reason Santos's lies are being pursued is because he's an openly-gay Republican, whom Democrats are targeting for extermination (you know, instead of Republicans targeting LGBTQ+ folks as usual!)

Santos's larger, more immediate problem is that while lying about his college curriculum vitae or his place of employment aren't strictly illegal but is highly unethical, lying about how he got all his considerable millions to loan to his campaign actually is against the law, as Semafor's Kadia Goba explains.

When he first ran for Congress in 2020, Santos, who appears to have suffered from financial trouble for much of his adult life, filed disclosures listing no assets and a salary of $55,000, which he earned as a vice president at LinkBridge Investors, a business development firm. But the filings from his most recent run suggest he came into sudden riches, making between $3.5 million and $11.5 million from a company he founded called the Devolder Organization in 2021. He loaned his campaign more than $700,000.

In a phone conversation with Semafor, Santos offered a short tick-tock of how he made his money that left certain key details unanswered.

At LinkBridge, he said, he worked in the so-called “capital introduction” industry, which typically brings together investors and hedge funds. He eventually left that job for Harbor City Capital, a Florida firm the Securities and Exchange Commission accused in April 2021 of running a $17 million Ponzi scheme. Santos was not charged in the fraud, and he says he departed in March, shortly before the company ran into legal trouble, in order to strike out on his own. He incorporated Devolder in May, a few weeks after the S.E.C. filed suit against Harbor City.

Santos said that Devolder was also in the capital introduction business, including “deal building” and “specialty consulting” for “high net worth individuals.”

As an example of his work, he said a client might want to sell a plane or a boat. “I'm not going to go list it and broker it,” he said. “What I will do is I will go look out there within my Rolodex and be like: ‘Hey, are you looking for a plane?’ ‘Are you looking for a boat?’ I just put that feeler out there.” He said he had a network of wealthy investors, family offices, “institutions” and endowments that included about 15,000 people. Within the first six months of starting Devolder, he said he “landed a couple of million-dollar contracts.”

“If you’re looking at a $20 million yacht, my referral fee there can be anywhere between $200,000 and $400,000,” he said.

Santos did not respond to follow-up questions asking what the million-dollar contracts entailed, or if he could share the names of previous clients from his business.

Devolder was dissolved in September 2022 after failing to file an annual report. Given that timing, Rep.-elect Dan Goldman, D-N.Y., has raised the question of whether it was created merely to funnel illegal campaign donations. Santos added further to the mystery by reviving Devolder in Florida last week after the New York Times ran its initial bombshell story about fabrications in his resume, at an address reportedly owned by a former Harbor City executive.

Santos told Semafor that Devolder only shut down because his accountant accidentally submitted its yearly paperwork late.

Republicans have been reluctant to weigh in on Santos’s controversy. But on Tuesday, Rep.-elect Nick LaLota, R-N.Y. followed Democrats in calling for an ethics investigation and law-enforcement involvement “if necessary.” Rep.-elect Anthony D’Esposito, R-N.Y. from the neighboring district urged Santos to “pursue a path of honesty.”

Goldman, a former prosecutor, told Semafor he thought a formal inquiry might not be necessary if Santos simply volunteered documents about his business dealings and finances.

“If he wants to avoid an investigation and he wants to truly come clean, as he claimed he was trying to do yesterday and that other Republican members elected called for him to do, then he should be an open book and reveal all of this related to the Devolder Organization,” Goldman said.

That, however, seems unlikely to happen soon.

“I don’t dance to the tune of Congressman-elect Dan Goldman,” Santos told Semafor. “I don’t dance to the tune of these guys. If it was requested of me to produce any documentation from this organization, I have no problem doing so to people with the proper authority, not to authoritarian members of congress that think they have authority over their peers.
He's certainly suggesting that the he won't be cooperating with any House Ethics Committee investigation, not that it will produce anything under a GOP-controlled House. But he also seems to be suggesting that maybe the SEC or Justice Department should have a look, and frankly I think they should. 

Anne Donnelly, the Republican district attorney for Nassau County, has opened an investigation into GOP Rep.-elect George Santos after he admitted lying about his work experience and educational background.

Santos, 34, admitted Monday to fabricating key parts of his resume that he had announced on the campaign trail, including that he did not graduate from Baruch College, work for Citigroup or Goldman Sachs, or own any properties.

Santos' admission came one week after a New York Times report found holes in the record he touted during his campaign for New York's 3rd Congressional District.

Donnelly, a longtime Nassau prosecutor who took office at the beginning of the year, told Newsday in a statement:

“The numerous fabrications and inconsistencies associated with Congressman-Elect Santos are nothing short of stunning. The residents of Nassau County and other parts of the third district must have an honest and accountable representative in Congress. No one is above the law and if a crime was committed in this county, we will prosecute it."

Pretty sure Santos is in real trouble here.
Having said that, NY Dems and the local media can't be spared from the criticism either, because the even larger issue is exactly how this con man won a House seat in the first place as former Dem Rep. Steve Israel explains.

Voter disconnection must be part of the explanation for why Santos won. Voters in NY-3 say they value integrity and honesty, and I believe they do. But they weren’t on the lookout for a huckster politician; they didn’t think that could happen here, because it hadn’t before.

Moderate Democratic candidates have fared well in the region since 2000. Had Joe Biden run in the redrawn NY-3 map in 2020, he would have won by 8.5 points instead of 10.5, according to Politico. This year, most political observers viewed the district as naturally Democratic, especially against a Republican who’d lost his last election. That’s what I mean by Democratic complacency: the complacency of the establishment.

When he ran against Tom Suozzi, my successor, in 2020, Santos was a complete unknown. I asked Suozzi if he’d found anything of note in his opposition research, but Suozzi said he hadn’t bothered to do much. “It was the middle of COVID,” he said. Santos “had only $40,000 in his campaign account, and he was a nut. We ignored him and won by 12 points.”

Santos ran again in 2022, maybe because he understood that being ignored was a strategic advantage. This time around, the DCCC prepared an initial research document that raised plenty of red flags. The committee turned that document over to the Democratic candidate, Robert Zimmerman, who says his campaign “was unrelenting in getting people’s attention.” But, according to Zimmerman, the prevailing response was along the lines of This guy isn’t going to win, so he’s not a story.

Only after Santos defied expectations did that dynamic change. And by that time, it was too late for voters to react to Santos’s long con. Here’s where media decline enters the story.

The media’s failure to dig into Santos shows the predicament that local newsrooms face in 2022. Newsday dominates the media landscape on Long Island. And its reporters do quality work—they turned out an important investigation just a few years ago that exposed racism in the local real-estate industry. But they don’t have the resources to cover everything—not even everything in their political backyard—and they appear to have written off NY-3 as low priority given the district’s Democratic tilt. So did all the other once-mighty New York–area media operations.

Some observers have also criticized Zimmerman’s campaign for not fully investing in opposition research based on the initial DCCC project. Perhaps that criticism is justified, but we shouldn’t let the Republican Party off the hook. Republicans accepted Santos’s narrative without due diligence because they prioritized extreme ideology over actual qualifications. Santos was at the Ellipse on January 6, 2021, and has even claimed that he helped arrested insurrectionists with their legal fees.

NY-3 voters should have had an honest choice between two candidates—not a choice between Zimmerman and Santos’s fan-fiction version of himself. Politicians embellish résumés; if that were a crime, every candidate in America would be in prison. But Santos’s lies are an assault on democratic norms. The Republicans should have vetted Santos. The Democrats should have checked him out more thoroughly. The media should have as well.

But now, barring a surprise Santos resignation or action following investigations by the House Ethics Committee and the Department of Justice, Long Islanders—and the nation—are stuck with a congressman who is a figment of his own imagination. The caucus of unhinged representatives—the Marjorie Taylor Greenes, the Lauren Boeberts, the Matt Gaetzes—has just increased by one.
Trump lied about everything, and lied his way into the WHite House as Democrats in 2016 got complacent, lazy, and apathetic. The same thing happened on a smaller scale in 2022, and the issues of apathy, complacency, and outright laziness in the Democratic establishment continues.

Santos is what happens when you don't fight like hell for every seat.

Remember that going forward.
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