Skeletons Haunt Senate Hopefuls

There are eight Republicans, three Democrats and two Independents currently running for the U.S. Senate that have bankruptcies, tax liens or criminal convictions in their past.
Thirteen candidates have past bankruptcies or criminal records

Scott D’Amboise, a self-proclaimed Tea Party candidate, has raised more money than any of his fellow Maine Republicans in the race to replace retiring Sen. Olympia Snowe, winning support by promising to trim government spending and balance the federal budget. He’s even accused Snowe of being “fiscally irresponsible.”

But there was a time not so long ago when D’Amboise couldn’t balance his own budget.

An investigation of public records shows the small business owner filed for Chapter 7 bankruptcy protection in 2003, succumbing to more than $100,000 of debt from credit cards, doctors, hospitals and a mortgage. It’s an episode from his past that is absent from his official campaign biography, and one he doesn’t dwell on while he courts voters in the June 12 primary.

D’Amboise’s campaign blames a medical crisis that required his son to undergo seven operations. “He didn’t have adequate health coverage and was forced to file for bankruptcy,” said Sam Pim, D’Amboise’s campaign manager. “When you have a sick child, you have to do whatever is necessary to help that child.”

Pim said D’Amboise has occasionally mentioned the bankruptcy in the context of the medical crisis on the campaign trail while discussing his opposition to President Barack Obama’s Affordable Health Care Act. “He is in favor of repealing Obamacare,” Pim said.

D’Amboise isn’t the only candidate with past financial troubles. At least 13 politicians currently running for Senate – most with a message of fiscal restraint -- have filed for bankruptcy, been hit with liens for overdue taxes or been convicted of crimes, according to an investigation of the 350 candidates running for Senate that was conducted by the nonpartisan research firm InvestigativeCheck ( and shared with the Washington Guardian.

The candidates with past troubles span the country and cut across party lines: there are eight Republicans, two Independents, and three Democrats. They include one who has been convicted of writing a bad check in Tennessee, another convicted of damaging property in Wisconsin, and a third accused of fleeing Minnesota and remaining a fugitive overseas.

InvestigativeCheck, which conducts in-depth research for corporate and political clients, uncovered the candidates’ backgrounds through an exhaustive check of thousands of public records. The firm’s CEO, former NBC News investigative producer Jim Popkin, worries that local voters and some local reporters don’t know enough about the candidates running for one of the highest offices in the land.

“If I signed up to be a basketball coach at the Boys & Girls Club, I would get fingerprinted and given a background check. But for people running for U.S. Senate, there’s often no similar standard,” Popkin said. “That’s why you have a situation when people are running for U.S. Senate that have criminal backgrounds or serious financial issues. The point is, we should know a lot more about people who are running for political office, especially people running for United States Senate."

Most of the candidates identified by InvestigativeCheck make little or no mention of their past troubles on the stump, and federal law doesn’t require candidates to disclose past convictions, bankruptcies or tax liens.

But for voters, that kind of information is key, said Kent Cooper, the former disclosure chief for the Federal Elections Commission.

“You want to have a sense of candidates’ personal ability to tackle the job, how they will do dealing with billions of dollars of tax payer money in terms of understanding budgets and understanding priorities,” Cooper said. “Can they manage their own affairs? How can they manage others if they can't?”

Kenneth Poirier, a retired Maine resident who has donated $300 to the Scott D’Amboise campaign, agrees voters need to know about candidates’ financial histories.

“It is important for me to know, but I will vote for him despite the bankruptcy,” Poirier told the Washington Guardian. “People who run should disclose everything.”

For many candidates, a past personal bankruptcy strikes a contrast to the issues they focus on in their public life.

For instance, New Mexico State Auditor Hector Balderas, who put himself through college and law school after being raised by a single mother in a small rural village in New Mexico, has built a reputation for combatting government fraud in the state.

On his campaign website, he describes himself as having “an aggressive record of restoring accountability to state and local government.”

But in 1995, when Balderas was 21, he filed for bankruptcy. A college student at the time, Balderas was working on an assembly line in Albuquerque when he listed $20,017 in liabilities, including student loans, against just $5,817 in assets, records show.

Balderas addressed the bankruptcy in a 2004 candidates’ form filed with the Albuquerque Journal during his successful run for state representative, InvestigativeCheck found.

“I filed for Chapter 7 when I was a 21-year-old college student. Since that time, I have gained stable financial standing, started a business and provided a home for my family,” he wrote. His current campaign bio, however, makes no mention of the bankruptcy.

The campaign did not reply to the Washington Guardian’s repeated requests for comment.

Like D’Amboise, Tea Party candidate Brenda Lenard in Tennessee has made limiting spending to reduce the national debt the cornerstone of her campaign. She is challenging incumbent Sen. Bob Corker for the GOP nomination. With more than $58,000 in individual contributions, Lenard has raised more money than any other GOP challenger.

“I believe our exploding national debt threatens our national survival,” she said on her campaign website. “We cannot continue to spend money that we do not have with an IOU drawn off the backs of our grandchildren.”

But Lenard has her own lengthy record of spending money she couldn’t afford, leaving behind a trail of bankruptcies and a criminal case, InvestigativeCheck found. In 1993, for instance, she was convicted in Georgia by a county superior court judge of deposit account fraud, a felony that means writing bad checks in an amount greater than $500. She had to pay a $250 fine and spent 12 months on probation, according to public records.

Twelve years later, a federal judge in Atlanta accused her of abusing the bankruptcy system when she filed for Chapter 13 bankruptcy protection for the fourth time in three years, according to court documents. Unlike Chapter 7 bankruptcy, which provides the filer immediate relief from debt obligations, Chapter 13 is for filers with regular incomes that need the court to create a plan to pay off their debts over time. In a court order, the federal bankruptcy judge notes that Lenard had failed to meet the requirements of the Chapter 13 filing, including paying her trustee, filing a plan and a schedule for debt payment as required, and attending the filing hearing.

In a statement sent to the Washington Guardian, Lenard said the deposit account fraud charge came while she was working as a contractor in Georgia and deposited a check from a client. She said her bank told her she could withdraw funds from the check, but the check turned out to be bad, and in Georgia that is a felony.

The bankruptcies, she said, were also due to a misunderstanding.

“I had just buried my six-month old son and was a distraught single mother, raising toddlers. Unable to afford legal counsel, I simply tried to correct my errors on the bankruptcy form, and it appeared I filed numerous times,” she said in a statement. “When you’re coming from poverty and are striving to become independent and self-reliant, mistakes are an inevitable part of the learning process.”

Today, Lenard is studying for a Ph.D. in Political Science at the University of Tennessee. “I have nothing to be ashamed of, but rather I’m an example of what a person can do to better themselves, by their own volition,” she said.

Bankruptcy is an experience increasingly more Americans have gone through in the past 10 years. Between 2001 and 2011, nearly 17 million Americans filed for bankruptcy, according to U.S. Bankruptcy Court files. That’s up from 11.5 million during the 10 years prior.

Popkin said the number of candidates who have been through bankruptcy “is
just a reflection of what is happening in our economy.

“It shows politicians are people too,” he added.

A few of the candidates have seized upon that idea and argued that their financial problems would help them to empathize with their constituents.

“I have been through, and I’m currently going through, the same problems as so many Americans are today. I’m a single parent, I’ve been divorced, I’ve filed for bankruptcy, and my education is that of California’s High School Equivalency (GED),” Keith Holbrook, a California Republican, says on his campaign website. He filed for bankruptcy in 2009, according to public records.

John Mangelli, a lawyer running as an independent in New York, said his 2007 bankruptcy was a result of the same financial struggles many Americans face.

“It was a result of student loans, starting a family, maintaining a career and income not meeting expenses,” he told the Washington Guardian. “I believe it makes me a better candidate...I know the hardship out there and I’ve experienced it."

Although he admits it will be a challenge to get the 15,000 signatures required to appear on the ballot in November, Mangelli said he was inspired to launch his self-financed campaign by the Occupy Wall Street movement.

“This is my way of holding up my sign and protesting,” said Mangelli, who describes environmentalism as his central issue.

Ohio independent candidate Scott Rupert, who faces more than $62,000 in current tax liens, said his experience with the IRS led him to enter the U.S. Senate race. The conflict between Rupert and the IRS began in 2007 when the crankshaft broke on the motor of his 18-wheeler, the truck he uses to make a living.

“The money that I had to use to pay that bill, is the money I had set aside to pay my taxes with,” he said in an interview. “My choices were fix the truck so I could continue to make a living, or pay my taxes and have to go on welfare.”

Rupert chose to fix his truck and offered to set up a payment plan for his taxes, which, he said, the IRS rejected. Since then the IRS has filed several liens against him, a $19,283 lien in 2008, a $14,032 lien in 2009, and a $12,135 lien in 2010. He said he has been paying as much as he can afford to the IRS each month, while keeping up with his other expenses, including his wife’s recent medical surgeries. He has not filed for bankruptcy.

“I think half of the small businessmen can relate to what I am going through. A catastrophic event outside of my control created this situation and I dealt with it the way it needs to be dealt with,” he said.

Another reason for his frustration was the timing, he said. While the IRS informed him he owed his overdue taxes plus penalty fines, he watched the government bailout big Wall Street banks.

“It didn’t sit well with me,” he said. “Ordinary people are paying the price for irresponsibility of not so ordinary people.”

All elected officials and candidates for elected office are required to disclose some of their finances under the 1978 Ethics in Government Act. The annual financial disclosure reports are filed with the Clerk of the House of Representatives or the Secretary of the Senate by May 15, or 30 days after a candidate raises or spends in excess of $5,000.

The reports are “a snapshot in time of their financial wealth,” explained Cooper, the former chief of disclosure at the FEC.

In the report, candidates are required to detail their current incomes, investment accounts and what stocks they bought or sold during the period since Dec. 31 of the previous year. Candidates must disclose if they own any income producing residences, but they don’t have to list the details of their personal residences or mortgages. The employer of their spouse is also required, but not the exact details of his or her income.

“Any outstanding liabilities or loans will have to be listed,” Cooper said. But if there is nothing pending, candidates have no requirement to reveal it.

“It is not something they normally do, they don’t want to open up their wallet or pocketbooks to disclose their personal wealth,” he said.

Bryan Hackbarth, a candidate for the Arizona Republican nomination for U.S. Senate, said the fact that he filed for bankruptcy in 1995 is not relevant to the race as it is a private matter.

“Personal lives have nothing to do with people serving in the public realm...what’s in the past is in the past,” he told InvestigativeCheck. “My private life is private, plain and simple.”

When contacted by the Washington Guardian Hackbarth refused to comment.

“I am not going to get into anything that is over 15 or 20 years old. It has no bearing on anything,” he said before hanging up.

The former mayor of Youngtown, Ariz., and current owner of a cleaning business, Hackbarth describes his plan to combat debt in Washington as “Economics 101."

“When you only make so much money and your bills are more than that…you don’t spend more do you? No! You find ways to CUT back; you give up things until your budget is adjusted and your income improves. We, as Americans, must learn to live within our means and so does our government,” his campaign website said.

In addition to his bankruptcy, the InvestigativeCheck search revealed a criminal record. Wisconsin Crime Information Bureau records show that Hackbarth was convicted of disorderly conduct in Wisconsin in 1984 and of criminal damage in Wisconsin in 1992, for which the records state he received two years probation. In 1994, records show he was charged with battery/domestic violence in New Mexico, though that charge was later dismissed.

In an interview with InvestigativeCheck, Hackbarth explained that the domestic violence charge came after he had an argument with his ex-wife. “I happened to grab her wrist and re-injured her broken wrist,” he said. “The injuries were already there prior to me defending myself from being slapped.

“Everybody has a right to defend themselves. I am opposed to domestic violence,” said Hackbarth, who today lives with his wife and three children and describes himself as a “Christian and a family man” on his campaign website.

Two years prior to that incident, in 1992, Hackbarth was convicted in Wisconsin of “criminal damage” after he punched a door during a night of drinking with his girlfriend, he said.

A criminal background does not prohibit someone from running for federal office. According to Article 1, section 3 of the U.S. Constitution, anyone can run for U.S. Senate, as long as they meet three criteria: They must be at least 30 years old, been a U.S. citizen for at least nine years, and be an inhabitant of the state when elected.

Even someone running from the law can run for U.S. Senate without disclosing their background.

Take Jack Shepard, a dentist, who is running for the Democratic nomination for the U.S. Senate in Minnesota, a state where he does not live. In fact, Shepard doesn’t even live in the U.S. He lives in Rome, Italy as an international fugitive. After serving eight months at Stillwater state prison in Minnesota for a prescription drug and fourth-degree criminal sexual conduct conviction, Shepard failed to turn up for a court hearing in December 1982 where he was to be charged with first-degree arson for a fire at his dental office in Minneapolis. He’s been on the lam ever since.

Shepard’s mostly self-financed campaign is his third for U.S. Senate.

In 2004, when Shepard ran for the U.S. House in a Minnesota district, the state attempted to keep him off the ballot because he was a convicted felon, Bert Black, the legal adviser to the Minnesota Secretary of State, told the Washington Guardian. In Minnesota, all candidates running for state offices must be eligible voters. Felons who have not completed their sentences are not eligible voters. But the same prohibition does not apply for people running for federal offices. The Supreme Court of Minnesota ruled the U.S. Constitution permitted Shepard to appear on the ballot.

“Once the Supreme Court of Minnesota decided, that precedent applied for [Shepard],” Black said. “We follow court orders.”

Shepard will be on the ballot for the Democratic primary on August 14.

The InvestigativeCheck review identified five additional Senate candidates with bankruptcies, tax liens or criminal records:

• California businessman John Boruff, who is running as a Republican for the U.S. Senate, filed for Chapter 7 personal bankruptcy in San Diego, California in 2009 after his business suffered when Lehman Brothers collapsed and left him with an unpaid $80,000 loan. “When you’re a lifetime businessman things happen. We paid all our payrolls...but we had to file the business bankruptcy to protect our home,” Boruff said.
• A perennial candidate running for U.S. Senate in Michigan, Scott A Boman, filed for bankruptcy in 2001. He has previously run for Senate as a Libertarian; this year he is running as a Republican. Boman told the Sinclair TV network that a series of bad decisions led him to a point where he couldn’t keep up with his own debt. “This became a personal crisis requiring either the option of default or bankruptcy. I chose the latter, which is generally a more acceptable approach under the way creditors look at one's debt,” he said.
• Former state senator John Carroll is running for the Republican nomination for U.S. Senate in Hawaii. In 1994, Carroll filed for Chapter 7 bankruptcy and between 1996 and 2010, the IRS and the State of Hawaii have filed nearly $800,000 in tax liens against him. Although, Carroll did not respond to repeated attempts for comment, he confirmed the bankruptcy in an article in the Honolulu Advertiser in 2002. In a Hawaii newspaper article he explained the bankruptcy was "forced on him when foreign partners tried to squeeze him out of the pilot-leasing company he founded."
• Nashville businessman Larry Crim, a candidate for the Tennessee Democratic nomination for U.S. Senate, filed for bankruptcy in 2008. A campaign spokesperson told the Knoxville News-Sentinel that he was a victim of “predatory lending” for a development project. His bankruptcy filing case closed just last year.
• Ronald McNeil, a businessman running as a Republican for U.S. Senate in Florida, was issued a tax lien in 2005 for more than $1.8 million in unpaid taxes between 1994 and 1999. He told InvestigativeCheck the IRS made numerous “idiotic filings” against him and he appealed them for years. If elected to the Senate, he said, “I will be the worst enemy the IRS ever had.” McNeil did not reply to the Washington Guardian’s request for additional comment.

Brophy Tuesday 19 June 2012 - 09:18 am | | Brophy Blog

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