The political games have begun. Just a day after Barack Obama named Senator Joseph R. Biden Jr.
The political games have begun. Just a day after Barack Obama named Senator Joseph R. Biden Jr. of Delaware as his vice presidential running mate, media reports are tying members of his family to an alleged hedge fund fraud scheme.
Biden’s son Hunter and his brother James are accused in a lawsuit of defrauding a former business partner and an investor of millions of dollars in a hedge fund deal that went sour. In reply, the two say their partner, Anthony Lotito, defrauded them by misleading them about his hedge fund experience.
The fight is over Paradigm Companies, a hedge fund group Lotito says he set up for the Bidens as a way to get Hunter out of the lobbying business. Hunter’s lobbying was allegedly considered a potential political liability for Joe Biden, then running for president. Hunter denies his father played any part in the deal.
One way or the other, it can be argued that this ties the new candidate for vice president as a "supporter" of hedge funds. But at the same time, Biden is also not a big fan of hedge funds – as was derived from his speech in a Democratic primary debate last year.
In the speech, Biden blamed hedge funds and private equity funds for the credit crunch: "We need more transparency, particularly with regard to hedge funds and private equity funds. They are the ones that are causing this thing to go under. And there’s no transparency, no accountability. We don’t know how deep this problem is."
While the lawsuit might be just making the headlines due to lack of scoops, Biden’s stance on hedge funds in general needs to be clarified once again.