Silver-Spoon Dick...

Jeb Bush dogged by decades of questions about business deals

By Robert O'Harrow Jr. and Tom Hamburger

In early 1989, seven weeks after his father moved into the White House, Jeb Bush took a trip to Nigeria.

Nearly 100,000 Nigerians turned out to see him over four days as he accompanied the executives of a Florida company called Moving Water Industries, which had just retained Bush to market the firm’s pumps. Escorted by the U.S. ambassador to Nigeria, Bush met with the nation’s political and religious leaders as part of an MWI effort to land a deal that would be worth $80 million.

“My father is the president of the United States, duly elected by people that have an interest in improving ties everywhere,” he told a group of dignitaries in a private meeting, according to a video documenting the visit. “The fact that you have done this today is something I will report back to him very quickly when I get back to the United States.”

Just days after Jeb Bush returned home, President George H.W. Bush sent a note to Nigerian President Ibrahim Babangida, thanking him for hosting his son. “We are grateful to you,” President Bush wrote on White House stationery.

MWI eventually got the deals it was seeking. Former employees said Bush’s participation was crucial. “There’s no question about it: ‘Here is the son of the president of the United States.’ It was a big deal,” Cornelius Lang, MWI’s former controller, told The Washington Post in a recent interview. “He could open doors we couldn’t.”

Today, as he works toward his run at the White House, Bush touts his business experience as a strength that gives him the skills and savvy to serve as the nation’s chief executive. He has said he “worked my tail off” to succeed. As an announced candidate, Bush soon will be making financial disclosures that will reveal recent business successes and show a substantial increase in his wealth since he left office as Florida governor in 2007, individuals close to the candidate told The Post.

But records, lawsuits, interviews and newspaper accounts stretching back more than three decades present a picture of a man who, before he was elected Florida governor in 1998, often benefited from his family connections and repeatedly put himself in situations that raised questions about his judgment and exposed him to reputation-anal risk.

Years after Bush’s visit to Nigeria, MWI was found to have made dozens of false claims to the U.S. government about its dealings in Nigeria, according to a civil jury verdict in a case brought by the Justice Department. MWI has denied the allegations and appealed the verdict. Bush was not a party to the lawsuit.

Five of his business associates have been convicted of crimes; one remains an international fugitive on fraud charges. In each case, Bush said he had no knowledge of any wrongdoing and said some of the people he met as a businessman in Florida took advantage of his naiveté.

Bush, now 62, has said that he has learned to be more careful about vetting his associates, telling the Miami Herald during his first, failed run for Florida governor in 1994 that getting “burned a couple of times” made him “better at deciphering people’s motives.”

He has been involved in myriad business ventures dating back to the early 1980s, taking time out to run for governor three times, winning the first of two terms in 1998. He has brokered real estate deals in Florida, arranged bank loans in Venezuela, marketed industrial pumps in Thailand, wholesaled shoes in Panama, promoted abuilding-materials company to Mexican interests and advised transnational financial services firms. He sat on more than a half dozen corporate boards. Since leaving office in 2007, Bush’s income has soared from speeches, service on corporate boards, consulting and managing investments for others.

“Jeb Bush had a successful career in commercial real estate and business before serving as Florida’s governor,” said Kristy Campbell, a Bush spokeswoman. “He has always operated with the highest level of integrity throughout his business career.”

Before he became governor in 1999, he was comfortable but not rich. He did not earn the kind of fortunes that his dad and brother George did as young men. In his late 20s, George H.W. Bush started a successful oil company in Texas. In his 40s, George W. Bush made an investment in the Texas Rangers baseball team that eventually earned him nearly $15 million.

At first glance, Jeb Bush’s dual biography as a businessman-
politician can be hard to reconcile. Bush the politician presents the image of a man who is appealing, well-disciplined, intelligent and moderate. Bush the businessman has sometimes lent his name and credibility to money-making ventures that involved dubious characters.

He and his friends have explained this seeming incongruity by saying that he has been the victim of people who took advantage of his good nature.

“The only documented allegations come down to the fact that he did business with people that later turned out to be deadbeats and crooks,” said Tom Feeney, who was on the ticket as lieutenant governor during Bush’s 1994 campaign.

Bush’s business activities and missteps have been widely covered over the years, by the Miami Herald, the St. Petersburg (now Tampa Bay) Times, the Wall Street Journal, Mother Jones magazine and other publications, along with books by political scientists and journalists.

Bush declined to be interviewed for this article. Campbell suggested that reporters contact Armando Codina, a real estate developer in Miami and a Bush family friend who helped launch his career.

“I have a very high regard for Jeb and consider him a very insightful and intelligent businessman,” Codina said. “He is a workaholic and in my opinion he was a great governor, and would make a great president.”

One morning in March, Bush framed himself as a businessman for a Chamber of Commerce audience in Greenville, S.C.

“I’ve signed the front side of a paycheck,” Bush said. “I’m proud that I’ve been in business and know how it works.”

During a speech in New Hampshire in April, he underscored his business philosophy.

“Anybody in business knows that it’s not all the way the progressives decide it for us — kind of the top-down, driven approach where we are all supposed to get in line and it’s just going to happen because it’s all planned out,” he said.

“America at its best is an America that is dynamic, that embraces the unforeseen, that takes risks; that when there’s a failure, you dust yourself off and go at it again, and again and again. And the interaction of all of us together creates more prosperity, more potential, more innovation, more creativity than any government program ever created.”

It is the free-market credo that serves as Bush’s guiding light: No reward without risk.

John Ellis Bush, the third of six children, has always followed a prescription for success passed on by his father: Make enough money to take care of your family before going into public service.

He graduated from the University of Texas in 1974, in less than three years, with honors and a degree in Latin American studies. Married at 21, he took a job as a loan officer at a bank in Houston founded by the family of James A. Baker III, who later managed George H.W. Bush’s presidential campaign and served as his chief of staff.

Bush left banking in 1979, later professing boredom with the work, and moved his young family to Miami, a melting pot of intrigue and economic activity.

Soon after he arrived, he began volunteering on his father’s presidential campaign in the state and met Codina, a Cuban exile who had become a wealthy real estate developer and now managed the Bush campaign in Dade County.

After Ronald Reagan won the election and George H.W. Bush became vice president, Codina offered the 27-year-old Jeb a remarkable opportunity: to partner in a real estate brokerage firm. Bush would receive 40 percent of the fees from what became the Codina Bush Group.

Bush would consider his work with Codina to be the defining experience of his business career.

“I formed a business with my friend Armando Codina in Miami,” he said in his recent New Hampshire appearance. “It started with three people . . . and we built it into the largest full-service commercial real estate company in South Florida.”

One of his endeavors involved a high-rise office building that Codina was developing on Flagler Street in Miami, called Museum Tower. Starting in 1984, Bush negotiated leases and recruited tenants for the building.

He eventually received about $340,000 in bonuses for his work.

“Jeb played an important role in the success of Museum Tower,” Codina recently told The Post.

One of Bush’s real estate associates described him as an impatient, driven man who sometimes put in 16-hour days — and then got up to run before dawn.

“Jeb Bush is a gazelle,” Hank Klein told the St. Petersburg Times. “He’s running through life.”

As he came of age in the hothouse Miami real estate market, Bush associated with some people who later ran afoul of the law. One of them was a tenant in Museum Tower, a high-rolling young Colombian named Alberto Duque, who had somehow secured
$124 million in loans to finance a small bank and a coffee company. Duque drove around town in a Rolls-Royce and hosted Bush and other Miami luminaries at a lavish dinner. He once flew Bush to Costa Rica on his private jet to attend the presidential inauguration.

In 1986, Duque was convicted on 60 counts of bank fraud involving up to $100 million in loans. After serving seven of 15 years in prison, he fled from a halfway house and remains a fugitive.

Duque put Bush in an uncomfortable spot. Reporters covering his first campaign for governor in 1994 asked why someone as prominent as Bush would associate with such a person. Bush said Duque had simply fooled him.

“It just goes to show that the hallmark of a great confidence man is effortless deception,” Bush told the Herald.

From 1984 to 1986, as he pursued his career, Bush also served as chairman of the Dade County Republican Party, where he met people who would become business associates.

Among them was Miguel Recarey Jr., a wealthy health-care entrepreneur who had once served time for tax evasion and boasted that he knew Santo Trafficante Jr., a Florida mobster. Recarey owned International Medical Centers, or IMC, a health-maintenance organization in Miami that grew rapidly in the 1980s through hundreds of millions of dollars in payments from the Medicare system.

In 1985, he retained Bush to find office space for IMC, eventually paying him $75,000, though a lease was never signed.

Recarey needed approval from the Department of Health and Human Services to continue to receive new business from Medicare patients. He asked Bush if he would intercede on his behalf with regulators in Washington, according to congressional testimony. At the time, his father was vice president.

C. McClain Haddow, then chief of staff to the HHS secretary, told The Post recently that Bush’s intervention “certainly altered the trajectory of the decision” in Recarey’s favor.

In 1987, IMC was shut down as regulators searched for $200 million in missing federal funds. Recarey fled the country. He remains a fugitive in Spain.

Bush said he was unaware of wrongdoing at IMC and said he was not paid by Recarey to lobby HHS on his behalf. He said he was only doing a favor for a fellow Florida businessman.

“At the time, I didn’t feel I was doing business with a crook,” he later told the Herald. “Unfortunately, I didn’t give it a whole lot of thought.”

Campbell recently told The Post, “As Governor Bush has said multiple times, he only recollects making a call to HHS and simply asking for a fair shake for Mr. Recarey as other Florida leaders did as well. It is unfortunate that he turned out to be a bad actor.”

Matthew Corrigan, a political science professor at the University of North Florida and the author of “Conservative Hurricane: How Jeb Bush Remade Florida,” described Bush’s attitude in these years as “a little bit of damn the torpedoes, full speed ahead.”

“His judgment on who to associate with is lacking,” Corrigan said.

Bush provided another favor that later raised questions, this time for Camilo Padreda, a Cuban immigrant and real estate developer who was the Republican Party’s finance chairman in Dade County. In 1985, Padreda had landed on the front pages of Miami newspapers for allegedly having a role in a scheme to bribe a city zoning official, but he was never charged.

In 1986, Bush accepted $75,000 from Padreda to work as the leasing agent on an office building Padreda had financed with help from the Department of Housing and Urban Development. Padreda asked to reach out to regulators at HUD on behalf of a friend who wanted HUD to provide loan insurance on an apartment building south of Miami.

The friend, Hiram Martinez Jr., obtained the loan but later defaulted. Both Martinez and Padreda were eventually convicted of fraud for inflating the value of the property.

The cavalcade of Florida crooks would be a recurrent irritant as Bush pursued his political career. But in a statement to The Post, Codina said Bush’s “record for having only a few clients who ultimately turned out to be less than truthful is remarkable, and that record would compare favorably with any firm in this business, either in Miami or another city.”