SEC Shines the Light on Crony Capitalism

…the White House and several of the Executive Department agencies may have a very busy schedule over the next few months trying to figure out what they didn’t know and when they didn’t know about LightSquared…

Chriss W. Street
Big Government

Harbinger Capital Partners LLC hedge fund just acknowledged its highly political founder Phillip Falcone and other key executives have received “Wells Notices”. Such communications are normally sent by the Securities & Exchange Commission to a target for fraud just before the Justice Department launches a civil and or criminal case. Although the Wells Notice appears to relate to allegations that Mr. Falcone used his hedge fund customers cash as his personal slush fund; an indictment of Mr. Falcone will also inflame the swirling crony capital investigation by the Congress of White House pay-to-play donations in support of a $14 billion scheme to siphon off part of the U.S. military and civilian Global Positioning Satellite (GPS)’s dedicated wireless bandwidth by a start-up company Mr. Falcone controls, called LightSquared.

LightSquared’s business model appeared to be the creation of an entirely new “4G” internet wireless network from the fringe safety zone bandwidth dedicated to the secure military and civilian GPS. Mr. Falcone, his wife Lisa Falcone, and LightSquared Chief Executive Officer Sanjiv Ahuja each made $30,400 political contribution to Democratic campaign organizations in 2010 to allegedly influence Federal Communications Commission (FCC) to allow the project to proceed under increasingly relaxed standards according to Congressional sources. A letter from Republican House members referred to e-mails between LightSquared representatives and White House officials about attendance at fundraisers for President Barack Obama that coincide with LightSquared contacts: “While some may call it a coincidence, we remain skeptical.”…

The article continues at Big Government.

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