Pelosis Lose Big Bet on Pro Football

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Politico:

Pelosis lose big bet on pro football

By JAKE SHERMAN & JOHN BRESNAHAN & MANU RAJU | 6/16/10 7:26 PM EDT


Speaker Nancy Pelosi’s husband Paul lost up to $5 million on his investment in a new professional football league, according to the latest congressional financial disclosure reports released Wednesday.

Mr. Pelosi, a wealthy investor, spent $12 million last year buying the California Redwoods of the United Football League, according to report last October in the Washington Post.

Yet the speaker’s annual disclosure report valued the team at only between $1 million and $5 million. It is unclear why there is a discrepancy in what Paul Pelosi paid for the Redwoods as described in the Post story and the team’s valued as stated in the disclosure report.

The disclosure report further shows that the Pelosis suffered a loss of up to $5 million on the football franchise, although no exact figure is provided.

The UFL was the brainchild of Bill Hambrecht, a Pelosi friend and deep-pocketed investment banker who helped take Google public in 2004. The UFL was designed to be an alternative to the mega-powerful National Football League in smaller media markets, but it hasn’t lived up to its backers’ expectations so far. The Sports Business Journal, a sports-industry publication, reported last fall that the UFL lost $30 million during its inaugural season, which is millions more than initially projected.

Pelosi’s office declined to comment on the financial losses the couple suffered.

Despite the football debacle, the Pelosis remain very rich by any objective standard. Overall, the Pelosis are worth between $24.6 million and $89 million, minus their liabilities. Their holdings include a vineyard in St. Helena, Calif., worth between $5 million and $25 million; several commercial properties in San Francisco; hotel partnerships in Rutherford and Sonoma, Calif.; and an Asian investment fund worth up to $5 million.

Paul Pelosi also sold between $5 million and $25 million in Apple stock last year. He may have used the proceeds from those sales to finances his purchase of the California Redwoods, since his first payment to the UFL took place only days after his initial sale of Apple stock in April 2009, according to the disclosure report.

As speaker, Pelosi herself earned $223,000 in congressional salary in 2009, plus another $102,161 in book royalties.

The annual disclosure reports filed by members and senators include a broad range of values for assets and transactions, giving the press and American public an overview of lawmakers’ personal wealth and investments. Personal homes are exempted from the reports, as are other assets like cars, artwork and antiques.

The reports show several members of Congress offloaded major assets.

Late last year, Minority Leader John Boehner (R-Ohio) liquidated between $1,000,000 and $5,000,000 of his Nucite Sales profit-sharing retirement plan. Nucite was a plastics company that provided the bulk of his wealth. Boehner’s office says he did not control the investment in the retirement fund.

On the day he sold off his Nucite assets, Boehner bought at least $698,000 in companies such as Goldman Sachs, BP, AT&T, Chevron, ExxonMobil, JPMorgan, Pepsi and Microsoft and others. Boehner’s holdings in BP are worth between $1,000 and $15,000.

In addition, Boehner purchased $81,000 on bonds and notes from companies like AT&T Wireless, Duke Energy, General Electric and the now-shuttered Wall Street firm Bear Stearns.

“Mr. Boehner closed out his retirement account from the small business he ran before coming to Congress, and, on the advice of his financial adviser, shifted the funds to other investments,” said Michael Steel, a spokesman for Boehner.

Based on the minimum possible estimate of his personal fortune, Boehner is worth at least $1.7 million.