Financial analyst alleges Clinton Foundation fraud

The Clinton Foundation finds itself under new scrutiny, this time pertaining to its financial disclosures. Wall Street analyst Charles Ortel is uploading a series of reports showing what he alleges is fraudulent activities by the Foundation.

Ortel says he has the documentation to demonstrate Clinton entities have broken state and federal law and have never undergone outside audits, as is required. Ortel’s conclusions are based on what he describes as “reams of public filings and comments made by the Clinton Foundation as well as related parties.”

Ortel finds:

The numbers that the Clinton Foundation supplies to the public in its legally mandated filings do not add up, are frequently incorrect, and appear to be materially misleading. In numerous cases, the Clinton Foundation appears to have followed inconsistent policies adding in appropriate portions of the various activities it pursued around the world to create “consolidated” financial statements. . . .

[I]n several instances portions were added only for some of the years in which the entities remained in operation, artificially enhancing purported financial results. In other cases, important elements of activity were improperly characterized and combined.

Meanwhile the Foundation solicits donations even though its informational filings are not in compliance with applicable law. Regulators at Federal, State, Local, and international levels are not doing what they should do to protect the public.

The Justice Department reportedly is investigating the Clinton Foundation. It might therefore be interested in this passage from one of Ortel’s reports:

U.S. states and foreign countries. . .have strict laws concerning operating and soliciting for charities that wish to offer their donors the benefit of making tax-deductible contributions. In most states and foreign countries, charities including the Clinton Foundation must make truthful filings, many of which are readily accessible.

In the United States, states (and the District of Columbia) require charities to register before they solicit contributions, and to submit periodic reports–some of these filing requirements are easy to satisfy while others are demanding.

In all cases, charities are required to provide complete and truthful disclosures, particularly concerning trustees, executives, and, many cases, regarding “those who are in position to exercise significant influence,” whether or not they are named as trustees or executives.

In coming days, I will show in detail how Clinton Foundation entities submitted numerous false and materially misleading filings, or failed to submit disclosures to authorities within New York State and the State of Georgia, respectively. Infractions in both of these states (to name just two) started in 2001 and continue to the present.

Hal Moroz, a private attorney and former Georgia judge, reportedly has referred some of Ortel’s findings on the violations of the foundation to the state attorney general’s office.

There’s plenty more in Ortel’s reports, and it looks like there’s more yet to come.

Ortel will come under scrutiny as a result of his work. He’s a graduate of Harvard Business School who worked at the prominent mergers and acquisition firm Dillon Read and then at several boutique outfits. He went on to establish his own financial advisory firm.

In 2008, Ortel correctly identified problems with General Electric’s financial statements in 2008. He also blew the whistle on AIG. Based on his work detailing problems at AIG, the Sunday Times of London described Ortel as “one of the finest analysts of financial statements on the planet.”

Sunday Times reporter Tim Rayment said:

Where you or I see pages of numbers, [Ortel] sees a narrative. Sometimes the theme is a company’s potential for growth. Sometimes it is the prospect of self-destruction. And at times the story does not make sense, because the figures are hiding a fraud.

With the Clinton Foundation, the fraud narrative appears to be the operative one. Few who have been paying attention will be surprised.