| Bonds Online |
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| 5/10/2013Market Performance |
| Municipal Bonds |
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S&P National Bond Index
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3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
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0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
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1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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Municipal Bond Banker Pleads Guilty in Alabama Case |
Bloomberg - August 18, 2009 - By Martin Z. Braun
The head of a Montgomery, Alabama, securities firm and former state Democratic party chairman admitted that he paid off loans and bought expensive clothes and jewelry for the mayor of Birmingham to get bond and interest- rate swap business.
William Blount, the 55-year-old chairman of Blount Parrish & Co., changed his plea to guilty and will cooperate in the federal bribery case against MayorLarry Langford, according to a filing in federal court. The action comes three weeks after a lobbyist working for Blount admitted he funneled money to Langford and agreed to cooperate with the government.
“When you’re the last man standing in a criminal conspiracy case, the hill gets steeper to climb with each person that drops off and agrees to cooperate,” said Doug Jones, a former U.S. attorney in Birmingham, who represented ex-Alabama Governor Don Siegelman, convicted in an unrelated federal bribery case.
Federal prosecutors charged Langford, who is scheduled to go on trial Aug. 31, with soliciting $235,000 from Blount and lobbyist Albert LaPierre while the mayor was president of the Jefferson County Commission. In exchange, prosecutors said, Langford used his influence to steer county bond business to Blount, who earned about $7.1 million, including $3 million from JPMorgan Chase & Co., in connection with deals that refinanced the county’s sewer system’s debt.
Blount Plea
Blount pleaded guilty to one count of conspiracy and one count of bribery and agreed to forfeit $1 million. He faces 10 years in prison, which might be reduced to four years and three months if he provides “substantial assistance” to the government, according to the court filing.
Blount, wearing a grey suit, entered his guilty plea in federal court in Tuscaloosa this afternoon before Judge Scott Coogler. He declined to comment following the hearing.
Langford, 61, didn’t immediately return a call seeking comment.
“He’s going to forward to trial and he expects he’ll be acquitted,” said Michael Rasmussen, Langford’s attorney. “Why someone makes a payment is different from why someone receives a payment.”
Prosecutors allege the bribery began in July 2002 shortly after Langford, a Democrat, won a primary election for a Jefferson County commission seat through November 2007, one month after he was elected Birmingham mayor.
Court Filing
Blount showered Langford, a former television reporter, with designer clothes, including an Ermenegildo Zegna suit and a $12,015 watch from Tourneaubought while county officials visited New York City to discuss bond and swap deals, according to the court filing. Some of the items were sent by courier to Langford’s office in Birmingham.
The investment banker also funneled $99,000 to Langford through LaPierre and helped Langford get a $50,000 loan from Colonial Bank. LaPierre later repaid the loan and Blount reimbursed him.
Within weeks of the payments, Langford included Blount’s firm on Jefferson County financings, prosecutors said.
Blount and his companies paid LaPierre about $372,000 in connection with the Jefferson County financings, the filing said.
“The law is going to look at the intent of the giver as well as the person receiving,” Jones said. “It’ll make a tough road when you’ve got friends saying their intent was to corruptly influence his actions.”
Threatened Bankruptcy
The bond and interest-rate swap deals have threatened Alabama’s most-populous county with the biggest municipal bankruptcy since Orange County, California, in 1994. Rates on $3 billion of adjustable-rate bonds surged as high as 10 percent when companies that insured the debt lost AAA credit ratings because of subprime-mortgage related losses. Meanwhile, the swaps, which the county bought to lower borrowing costs, failed to protect it against higher rates.
The county paid JPMorgan and a group of banks as much as $100 million more for the swaps than they should have, according to estimates in 2007 by James White, an adviser the county hired after the U.S. Securities and Exchange Commission said it was investigating the transactions.
In addition to the $3 million JPMorgan paid Blount, his firm received $2.4 million from Bear Stearns Cos. Blount also worked as a consultant to Goldman Sachs Group Inc., which paid him $300,000 after Langford told JPMorgan to include the firm as a condition of a $1.1 billion swap agreement in 2003.
None of the banks nor their employees have been charged in the Langford bribery case. JPMorgan has disclosed it’s facing civil charges from the SEC regarding the Jefferson County deals.
‘Pessimistic Feeling”
Langford will have to overcome a “pessimistic feeling” about the county’s finances and the belief that a culture of corruption created the problem, Jones said.
“On the other hand, Larry Langford is a popular public figure,” Jones said. “He has some support and whether or not he can capitalize on that and put people in the jury box is just anybody’s guess.”
So far, 21 contractors or former county officials, including Langford, have been indicted or convicted of federal crimes in the construction and financing of the sewer system.
The case is United States of America v. Larry P. Langford, William B. Blount, and Albert W. LaPierre, 2:08-CR-00245-LSC- PWG, U.S. District Court, Northern District of Alabama (Birmingham)
To contact the reporters on this story: Martin Z. Braun in New York at mbraun6@bloomberg.net.
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