- The Washington Times - Sunday, August 4, 2013

A firm funding the car company founded by Virginia gubernatorial candidate Terry McAuliffe has claimed on its website for months that its MyCar electric vehicle had been approved by the Defense Department “for U.S. military installations worldwide” — but government officials say they have no record of such an approval.

The Washington Times searched a database of companies and contractors with business before the federal government and found no mentions of GreenTech Automotive or its MyCar two-seat vehicle. Government officials, too, found no evidence that GreenTech had been approved by the Defense Department to be a listed supplier for military installations.


SEE ALSO: SEC investigating company co-founded by Terry McAuliffe


Gulf Coast Funds Management LLC, which helps secure foreign investments in exchange for visas for GreenTech — its only listed client — had been making the claim on its website since earlier this year but quietly removed it last week after an inquiry from The Times.

The claim was deleted as two federal agencies — the Department of Homeland Security and the Securities and Exchange Commission — were investigating GreenTech over its use of the EB-5 visa program used to raise money from overseas investors for companies that create jobs in the United States.

As for the Defense Department claim, a company spokeswoman initially told The Times that officials were “in discussion with military bases and installations.”

But after it was informed by emails that checks with the Defense Department and the General Services Administration, which maintains the master list of government-approved suppliers, turned up no record of MyCar’s approval, the company removed the line.

In response to why it was removed, Marianne McInerney, executive vice president of sales and marketing at GreenTech Automotive, said Gulf Coast does not do “marketing” for GreenTech — even though the company was touting the claim about the MyCar as recently as Thursday.

“As I noted, we are in process for GSA approvals for the MyCar 14, our new model year,” Ms. McIrney wrote in an email. “We are featured in many buyers guides and are in conversation with several bases and installations.”

Retired Army Col. John Dillard, a defense procurement specialist at the Naval Postgraduate School in Monterey, Calif., said the case is not unprecedented.

“I’ve actually seen a good bit of exaggeration over the years,” Col. Dillard said in an email. “DoD Personnel are not allowed to make commercial endorsements, so you won’t see many of those — just occasionally, when someone goofs. If a business gets just one DoD contract they can say that they are ‘approved.’ But of course, that’s a bit of a stretch.”

A search of Internet archives shows that the claim about Defense Department approval was added to Gulf Coast’s website sometime from November to the end of January. Mr. McAuliffe reiterated over the weekend in response to reports of the SEC investigation that he left the company “in early December of 2012,” though he didn’t reveal that fact publicly until April.

His campaign did not respond to a request for comment on whether the claim was added to the website when Mr. McAuliffe was chairman of the company, which he helped found in 2009.

Nevertheless, the development adds another headache to a growing list facing GreenTech, the struggling company that was supposed to solidify Mr. McAuliffe’s bona fides as a “Virginia businessman” after spending his career in the trenches as a Democratic rainmaker and chief moneyman for Bill Clinton during the 1990s.

The Department of Homeland Security is investigating whether Alejandro Mayorkas, the director of the department’s U.S. Citizenship and Immigration Services, rammed through a visa application on behalf of Gulf Coast, which is run by former Secretary of State Hillary Rodham Clinton’s younger brother Anthony, even after it was rejected and an appeal was denied.

Mr. Mayorkas, President Obama’s pick to be the next No. 2 at the Department of Homeland Security, testified before Congress recently that the extent of his interaction with Mr. McAuliffe was one meeting in which he heard his complaints about investor visas being delayed.

But Sen. Chuck Grassley, Iowa Republican, said it went further than that.

“Contrary to the impression left by your answer, documents indicate that both before and after that meeting, you actually engaged in nearly a dozen contacts with Gulf Coast Funds Management between 2010 and 2013, including direct communications with Gulf Coast’s attorneys,” Mr. Grassley wrote in a letter dated July 31. “That one meeting with Mr. McAuliffe was clearly not the extent of your interaction on that matter.”

According to a cache of documents nearly 100 pages long released by Mr. Grassley’s office, the SEC also is investigating whether GreenTech guaranteed a positive return for its investors.

Mr. McAuliffe said over the weekend that he has no knowledge of the SEC investigation “other than what I have read in the papers.”

“If there are concerns as to whether procedures were properly followed, those concerns should be examined and I’m glad the company said it is cooperating fully,” he said. “Like many business leaders and political officials from both parties, I was among those who expressed frustration on several occasions to multiple individuals. I never asked for any preferential treatment, nor did I ever expect to receive any.”

The campaign of Mr. McAuliffe’s Republican opponent, Attorney General Kenneth T. Cuccinelli II, wasn’t buying the explanation.

“The most significant point is not whether the Securities and Exchange Commission investigation led to McAuliffe’s silent resignation from GreenTech Automotive, but that both the SEC and Department of Homeland Security are investigating actions taken by his company before he resigned as chairman,” Cuccinell campaign manager Dave Rexrode said. “Tellingly, McAuliffe’s statement did not deny that central fact.”