Bush makes one-day profit over $170,000

Discussion in 'Politics' started by ARogueTrader, Jan 1, 2004.

  1. Neil Bush makes one-day profit over $170,000
    President's brother exercised stock options in firm he advised
    Thursday, January 1, 2004 Posted: 8:49 AM EST (1349 GMT)

    Neil Bush says he acted on the recommendation of his financial adviser.

    WASHINGTON (AP) -- President Bush's brother Neil made at least $798,218 on three stock trades in a small U.S. high-tech company where he had been a consultant, according to his tax returns, including $171,370 buying and selling the company's shares in a single day.

    Neil Bush's big paydays in the stock of Kopin Corp. of Taunton, Massachusetts, included the July 19, 1999, purchase and quick sale of stock as the company announced good news about a new Asian client that sent its stock value soaring.

    Bush said he did not have any inside information from Kopin, and simply acted on a recommendation from his financial adviser.

    "Any increase in the price of the stock on that day was purely coincidental, meaning that I did not have any improper information," Bush said in e-mails to The Associated Press. "My timing on this transaction was very fortunate."

    The AP obtained Bush's tax returns for the years 1997 through 2001 from a source familiar with his finances.

    Bush noted that he lost $287,722 on Kopin stock after the market in high-tech stocks crashed.

    Unlike the ordinary investor who buys at the market price, however, Bush benefited from the fact that his stock purchase costs in some cases were minimal because he got a bargain, paying $13 a share when he exercised stock options that were part of his consulting compensation from Kopin. The company's stock price was selling for many times that amount during much of the time Bush was trading. The company granted him 20,000 stock options.

    Bush's returns, as well as records that have come to light in Bush's divorce case with his wife, Sharon, show that since his controversial tenure with the failed Silverado Banking, Savings and Loan Association of Denver, more than a decade ago, he has become a globe-trotting businessman with a variety of consulting deals.

    Bush says he first came in contact with Kopin when he was a consultant for an Asian company, Telecom Holdings, a telecommunications company whose executives wanted to invest in the United States. "We searched for a viable fit and found Kopin Corp.," Bush said. "The bulk of our equity compensation for the transaction came from" the Asian company, which took Kopin stock in exchange for its investment.

    "Neil helped put together an approximately $27 million deal and was awarded stock options for his efforts. Stock options can range from anywhere to being utterly worthless to very valuable," Bush lawyer John Spalding said in an interview.

    After the 1995 deal, Kopin snapped Bush up as a consultant for two years "to see what other doors he could open up for us" in Asia, according to Kopin's chief financial officer, Richard Sneider.

    "Neil Bush was a matchmaker and he was given stock options in Kopin as part of his compensation," Sneider explained. "Our executives were pleased with his hard work on the Asian investment."

    Kopin's CFO said, "I don't know whether Neil made any introductions to anybody" during his two years of consulting, but "there were no further equity investments" like the $27 million deal Bush arranged in 1995.

    On December 2, 1998, three weeks after Kopin reported the first profit in its 14-year history, Bush bought 10,000 shares of Kopin stock for $140,000. He sold it a year later for $692,053.

    On July 19, 1999, The Wall Street Journal published a story saying that a Japanese video camera company had started using tiny liquid crystal display viewfinders manufactured by Kopin.

    The newspaper called the deal "a surprising win for the U.S. flat-panel-display industry." The company officially announced the deal the morning the article was published.

    Bush said his financial adviser at Wells Fargo recommended shortly after 9 a.m. that he exercise the option to buy 15,000 shares of Kopin stock and immediately sell.

    "I did," Bush said. Kopin stock opened that morning at $28.62. Bush sold at $33.25. Bush sold the stock for $495,745 and he listed his cost on his tax return as $324,375.

    "My financial adviser ... recalls that I had instructed her to keep an eye out for an opportune time to exercise the options to buy 15,000 shares of Kopin stock as early as March of 1999," three months before the July transaction, Bush said.

    At the end of January 2000, with the stock market nearing its peak and Kopin's stock at over $70 a share, Bush moved into the market again. Five months later, he reported a gain of $74,795 on the sale of 4,000 shares, but he kept an additional 13,150 shares, eventually suffering the losses.
  2. AP...the original spin doctors.
  3. Hi,

    Neil must have taken a clue from Hillary Clintons future trading when she made 100k the first, only and "last" time she ever "traded" futures. Only difference that I can tell on the surface is in Hillary's case the man who owned the futures trading firm in Little Rock where she "made a great trade" was a very large campagn contributor.

    Funny how the associated press only cares about bush transgressions.

  4. Maverick74


    Aroguetrader, don't you wish you could trade that well? I guess it sucks flipping one lot e-minis for 50 bucks. Maybe one day you'll be a supertrader too and making the big bucks. In the meantime, well, you have your dreams.
  5. ART you just proved that Neil Bush (the lagging son) is somekind of genius because he cashed out of the tech bubble while everyone else basically tied themselves to the mast of the Titanic (er... I mean the NASDAQ), including George Soros who finally was spurred to make a big investment in the internet right before the top.
  6. Inside info always makes people look like geniuses.

    Terry McAuliffe made a bundle "cashing out" early too....


  7. Idoogye


    Gentlemen, PLEASE!

    This is a wretched way to begin the New Year. What has this "right" vs "left" stuff to do with elite trading?

    IMO, there is really only one political party in the US, and it has two wings: the conservative and the radical conservative. Right now, the radical conservatives are in power. But even if they weren't, the only difference in the game would be the names of the players.
  8. Cutten


    So he basically had some options on a company he worked for, and then when the stock popped on some news he cashed out. Sounds pretty normal to me, what's the beef?
  9. So we drill down into the actual story and find the magical "one day" profit was actually the result of exercising options that had been held for several years while they presumably were worth little. What was he supposed to do with the stock? Hold it and risk a tax disaster if it fell?

    Democrats have trouble with this kind of thing because they are used to getting paid millions to arrange golf outings.