Originally: Pols Haiti Hook-Up
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Former NBA superstar Julius Erving is among nearly a dozen headliners, many from the top shelf of Washington politics in the 1990s, who are connected to an odd and little-noticed Wall Street stock deal two weeks ago, The Post has learned.
All are current or recently departed board members or advisers to an obscure New York-based company called Fusion Telecommunications Inc., which went public in a Feb. 15 IPO underwritten by Long Island brokerage Kirlin Securities.
In the IPO Kirlin raised net proceeds of $20.5 million in a sale of bundled stock and warrants at $6.45 per unit, putting a market value of $112 million on the company.
During the Bush-Kerry presidential race last autumn, Fusion Telecommunications Inc. was linked by The Wall Street Journal to Democratic Party influence peddling in Haiti, but a review of past and present officials at the company shows a more bipartisan balance.
Among the Fusion big names from the world of Washington politics are former President Bush’s chief of staff, John Sununu, and his Clinton administration counterpart, Thomas F. McLarty III, along with the Clinton era’s Democratic National Committee finance chairman Marvin S. Rosen, and Clinton’s ambassador to Saudi Arabia, Raymond Mabus.
Others connected to the money-losing 54-employee company, which purports to offer “voice over internet” telephone service in the Third World, include President John F. Kennedy’s nephew, and former Massachusetts congressman, Joseph Kennedy II, as well as the elder Bush’s one-time budget director Joseph R. Wright Jr.
And, in the two weeks since the company has gone public, five officers and directors, including Sununu, Wright, and Rosen, have registered to sell their stock.
In an interview yesterday, Fusion’s founder and chairman, Marvin Rosen, told The Post that he had hired Kirlin Securities to underwrite Fusion’s stock offering after finding that even Fusion’s unusually impressive roster of big-name directors and advisers had not been enough to attract larger and more impressive investment firms like Morgan Stanley, Merrill Lynch and Goldman Sachs to the relatively small, $20-million offering.
In fact, Rosen’s own background as chief fundraiser for the Clinton reelection campaign may have put off some underwriters. After two years as DNC finance chief, Rosen quit government in 1997 to found Fusion Telecommunications, leaving behind a history of embarrassing disclosures connecting him to an array of questionable fundraising tactics for Clinton and other Democrats.
Among those disclosures: That Rosen had turned private sector access to the White House and the president – via everything from coffee klatsches with Clinton, to sleepovers in the Lincoln bedroom – into fundraising gimmicks. In April 1996, Rosen hosted a private $25,000-a-plate dinner at his Coral Gables home, where Clinton was joined at the table by a Mafia-connected stock swindler named Eric Wynn.
Not all those he has recruited have chosen to remain. Joseph Kennedy II resigned following some unflattering 2001 press coverage of Fusion’s business ties to the Haitian government of Jean Bertrand Aristide. Through a spokesman, Kennedy declines to comment on the matter now except to say that his resignation was “entirely routine.” Another early board member who has since resigned, Clinton Chief of Staff “Mack” McLarty, has been replaced by his counterpart, John Sununu, from the elder Bush’s presidency. Sununu serves in an apparently ceremonial position as a member of Fusion’s board of outside advisers, alongside Joseph R. Wright Jr., former President Ronald Reagan’s Deputy Secretary of Commerce and chief of OMB.
A source at Fusion said Wright hasn’t been in contact with the company in more than three years though his name is featured in the Kirlin IPO material.
Kirlin has been struggling with financial and regulatory issues of its own.
In August of last year, the firm paid $1.2 million to settle National Association of Securities Dealers charges of selling unregistered securities, false advertising, excessive markups and related offenses.
Fusion’s Rosen says Kirlin’s problems did not affect its work on the IPO and that he is happy with the results.
Newly public Fusion Telecommunications – reportedly linked to influence peddling in Haiti – has some high-powered
current and exbackers, including former basketball star Julius Erving and one-time Washington power brokers. A snapshot of Fusions fans:
Former Clinton top aide Mack McLarty
Former Bush aide John H. Sununu