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Former Reagan Aide Stockman Facing Possible Indictment
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ShareDecember 11, 2006 12:59 PM
A federal grand jury in New York may be asked as soon as next month to indict a top aide in the Reagan White House, David Stockman, on fraud charges, federal officials tell ABC News.
The officials said the investigation of Stockman, a former congressman who ran the Office of Management and Budget in the Reagan administration, centers on his role as CEO of a now bankrupt Michigan auto parts company, the Collins and Aikman Corporation.
The investigation has focused on whether Stockman and other corporate officers misled investors about the company's financial health.
Stockman's lawyer said his client had done nothing wrong and that reports of a pending indictment are premature. "We have not been told he is a target and are still hopeful the matter will be resolved without any further action by the U.S. Attorney's Office," said Elkan Abramowitz. He said Stockman has cooperated fully in the investigation, which was begun by the Securities Exchange Commission last summer.
Federal officials say Stockman could face charges of security fraud, mail fraud, wire fraud and giving false statements to the SEC.
Click Here for Full Blotter Coverage on the Brian Ross Investigative Homepage.
A civil lawsuit filed by investors claims Stockman and other executives made "false and misleading statements" and artificially inflated the company's stock prices between May 2004 and March 2005. The company filed for bankruptcy in May 2005.
Stockman was one of the youngest and most outspoken members of the Reagan Administration. His criticisms of Reagan economic policies in a 1981 interview by William Greider in "The Atlantic Monthly" magazine led Reagan to say he had taken young Stockman "to the woodshed" but did not fire him.
He later wrote a controversial memoir, "The Triumph of Politics - Why the Reagan Administration Failed."
After he left the government, Stockman established a private equity company, Heartland Industrial Partners, which invested in depressed Detroit companies, including Collins and Aikman.
A spokesman for Collins and Aikman, which is still operating under Chapter 11 bankruptcy protection, declined to comment to ABC News.
In August, the company acknowledged receipt of subpoenas from the federal grand jury and said it had turned over similar material to the SEC.
The company also said it was conducting its own internal investigation.
December 11, 2006 | Permalink | User Comments (9)
Hmm, another lying, illegal, corrupt, Republican corporate scumbag? Big surprise there.
Posted by: dave | Dec 11, 2006 4:12:08 PM
>Hmm, another lying, illegal, corrupt, >Republican corporate scumbag? Big >surprise there.
Let's not rush to judgment just because he happened to be a Reagan Republican. In America, folks are innocent until proven guilty and the facts aren't yet in.
Moreover, Stockman was actually a whistleblower on the Reagan economic shuck, and as OMB director, his criticism of "trickle down" as politics rather than economics was damning. Maybe not of Daniel Ellsberg's stature, but significant nonetheless.
Posted by: Tom | Dec 11, 2006 7:23:19 PM
It's sad when people with NO correct information have NO problem defaming innocent hard working people, especially those that at some point in their life had tried to give back something by working in the government. David Stockman is being HUNTED for the advancement of the prosecutors career, she is following the Elliot Spitzer lead, sadly in this country it seems to work. Does anyone in these blogs or in the media ever stop to think how painful and damaging these false articles can be to the children and family of those involved. IT really makes me sick how easy it is to attack, without actually having any DIRECT AND REAL INFORMATION ON THE CASE.
Posted by: Caryl | Dec 12, 2006 11:48:32 AM
Dear sweet Caryl; Federal Grand Jurys,(Jurys of Peers) do not Indict without DIRECT AND REAL INFORMATION ON THE CASE. Thamk you
Posted by: Ron Hunter | Dec 13, 2006 7:05:37 AM
Dear Sweet Ron,
He has not been indicted YET because there is no evidence. If you care to read the article, you will see that NO charges have been brought; this is all speculation. This is the prosecution's last desperate attempt (they leaked this info) to get some media attention before the case goes to the wayside. A hardworking, honest, mid-western man like Stockman was merely trying to revive the dying rust belt. Clearly the SEC would rather see our country's business leaders suffer.-- not only is the American car industry slowing dying by competition from our foreign competitors but NOW companies like Stockman's C&A must face bureaucratic hoola hoops at home. Ridiculous.
Posted by: Rachel | Dec 14, 2006 3:00:57 AM
David Stockman be a twit - Reaganomics did indeed work. He showed a shocking lack of judgement in his public Touette's sydrome then and apparently now. Reagan did him no favor by not letting him escape the consequences of his poor judgement. Lock the fellow up and throw away the key!
Posted by: Scotty | Dec 14, 2006 2:10:38 PM
Apparently some people would prefer to bury their head in the sand in lieu of reading the facts, right there on news print. . .
"It's sad when people with NO correct information have NO problem defaming innocent hard working people"
These allegations in the Stockman case necessarily have something to them, or else his name would not have been associated with them. If, these allegations were fruitless claims, then Stockman would be screaming bloody murder while sprinting all the way to civil court with a lawsuit for libel and slander asking for $10 million dollars.
Posted by: Henotter_Titiov | Dec 21, 2006 4:56:08 PM
I think what Caryl may have been referring to is the fact posters here have already indicted Stockman w/o any knowledge of the facts (other than he is a republican)and the headline to this story merely says he COULD be indicted not that he was indicted.
Also a fed subpoena does not necessarily lead to an indictment...ask Congressman Weldon.
Posted by: Lee Kirkland | Dec 22, 2006 5:50:46 PM
David Stockman wrote the first budget of the United States of America, ever! He helped structure a balance US budget without asking a soul. His accounting genius helped fund the computer revolution and the end of inflation as we alive in the Carter years knew it (~20%/yr). After OBM, given access to any job in the world, he eventually returned to the Midwest and did his best to turn around our failing automotive manufacturing & supply sectors and he did it at a fraction of what he could have earned in NY, London, Rome or Tokyo, let alone as another governmental lobbyist. If he misled investors it was because he was attempting to give working class families a chance to turn their fate around, yet “they” did not succeed. Oh what a crime! Let us do drag this man's good name through the mud and make a villain of him for giving the working class a chance to succeed. Pathetic we are!
Posted by: Christophor | Dec 23, 2006 3:22:46 PM
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