Editorial: Brown needs to lift the veil on his finances
Scott Brown may have finally found a way to get the “carpetbagger” chorus to change its tune, but he probably won’t like the new song much better. In fact, he may develop a sentimental fondness for the good old days when people merely questioned his geographical commitment to the Granite State.
Over the weekend, the Boston Globe published an article exploring Brown’s involvement with an amorphous company called Global Digital Solutions Inc., which last summer named Brown to its advisory board. He received stock that at the time was worth $1.3 million, though the value of those shares has since declined significantly.
While Brown’s campaign staff told the Globe that GDSI is a start-up company for which Brown is merely serving in an advisory capacity and not in the day-to-day management of the firm, descriptions of the company’s business practices serve as a garden of red flags for would-be investors.
“Accountants said in interviews,” the Globe reported, “that Global Digital’s filings raise a number of warning signs for investors, including its varying business model and lack of actual products. The firm reported it has four employees, $271,776 in cash and had $19.7 million in losses as of March 31.”
A former SEC lawyer told the Globe that the company’s actions raise a number of issues that a regulator would look at, including the frequency with which the company changes its business model.
So what does GDSI do exactly?
According to its website, the company “is refocusing its business strategy on positioning itself as a leader in providing various military-related products and services that will be coming on-line in the coming months, including a revolutionary suite of technology-enhanced services that offer personalized, digital small arms safety and security solutions in commercial and military-related markets.”
But as the Globe reported, GDSI does not yet have any products and has not always been in the arms business. It was founded as a beauty supply company before later shifting to wireless data.
To make matters worse for Brown, the revelations about GDSI come on the heels of his decision to seek an extension to submit a financial disclosure form, which was due to the Federal Election Commission in the middle of May but will now be submitted on Aug. 9, just a month before the Republican primary.
As a member of a party that has consistently attacked the Obama administration for a lack of transparency, Brown has very few options for safe ground here. If he can’t articulate his reasons for agreeing to serve on GDSI’s board, he will look like a politician who was unscrupulously interested in making some money between campaigns. If the heat intensifies and he tries to distance himself from GDSI, he will be hit for not doing his homework. And if he refuses to talk about GDSI and his other sources of income, including a speaking gig at a hedge fund conference in Las Vegas last month, he will look like a man with something to hide – and that’s not a good position for a candidate whose motives are already being questioned.
It could be that GDSI really is just a startup company in its infancy and that Brown was chosen for his expertise, but that isn’t the overarching issue for New Hampshire voters. It’s a matter of forthrightness.
As a private citizen, Brown is entitled to seek his fortune, but as a seeker of public office he owes the people a proper accounting. To wait until a month before voters must choose the Republican who will challenge Sen. Jeanne Shaheen is the worst kind of political sleight of hand.
Candidates who resist providing voters with information they need to make an informed decision about their representation in Washington are not worthy of the job.