Wall Street Journal breaks down business dealings of NC's largest political donor
Posted February 28, 2019 5:03 p.m. EST
Updated February 28, 2019 8:00 p.m. EST
Raleigh, N.C. — The Wall Street Journal published a deep dive Thursday on Greg Lindberg, breaking down the questionable business practices of North Carolina's largest political donor.
The newspaper said Lindberg invested premiums from a series of insurance companies into other companies he owns, making such investments at a far higher rate than industry standards meant to protect policyholders from risky investments that could dry up money needed to pay claims.
The newspaper gave one example where Lindberg moved a company to North Carolina to accomplish this, using the state's looser rules and an agreement with unidentified regulators to boost those investments during Wayne Goodwin's time as state insurance commissioner.
The Journal also reported that these arrangements – funneling insurance premiums through shell companies at a scale with "little precedent in recent decades" – helped Lindberg buy lavish properties, a 214-foot yacht, two jets and the most expensive private home ever bought in Raleigh. Much of that property is now up for sale, including Lindberg's mansions in Raleigh and Durham, and Lindberg is the target of a federal investigation with a grand jury meeting in Charlotte.
Lindberg declined The Journal's interview requests, but a spokesman said many of the purchases highlighted were investments, that the yacht has charter possibilities and that the two aircraft were used for business.
"Insurance companies have not been used to fund Mr. Lindberg’s lifestyle," the spokesman told the newspaper.
Lindberg has repeatedly declined to speak to WRAL News, and an effort to reach him through another spokesman Thursday was not immediately successful.
Lindberg was a political unknown in most of North Carolina until sometime in 2016, when he dropped $350,000 into a political action committee supporting Goodwin's re-election. He really hit the radar in 2017 and 2018, though, becoming the state's most generous campaign donor and topping $5.2 million in campaign contributions to state politicians.
Bob Hall, a longtime campaign finance analyst who retired in 2017 from Democracy North Carolina, puts the total at more than $6 million when other employees from Lindberg's companies are included. Lindberg has given to politicians in other states as well, often with a focus on the insurance industry.
He's given mostly to Republicans in North Carolina, and particularly the North Carolina Republican Party and entities backing Lt. Gov. Dan Forest, but he's a major donor to the North Carolina Democratic Party as well.
Current Insurance Commissioner Mike Causey turned over $240,000 from Lindberg to the U.S. Marshals Service last year. The money came to his campaign through the state GOP. Causey had previously returned direct donations from Lindberg and his wife.
The Journal revealed Thursday that Causey provided federal investigators with secret recordings in the case. The commissioner declined to confirm that Thursday to WRAL News, and would say only what he has in the past: His department has cooperated with the inquiry.
That department has gotten at least two subpoenas targeting Lindberg's businesses, many of which are regulated by the Department of Insurance. The Journal reported that federal investigators, who have repeatedly declined comment to WRAL News, are looking at Lindberg’s political donations and his relationship with North Carolina regulators. The newspaper cited three unnamed sources familiar with the investigation.
Goodwin, now chairman of the state Democratic Party, told The Journal that he has cooperated with federal investigators, that he's not the target of their inquiry and that “any suggestion that I have ever taken any action in return for contributions is categorically false."
Goodwin told The Journal that he didn’t recall “being asked to take or direct any action” to help Lindberg.
The Journal noted that Goodwin has done consulting work for one of Lindberg's companies, and that, as WRAL News has previously reported, two of Goodwin's top deputies at the Department of Insurance now work for Lindberg companies.
In a statement issued Thursday, Goodwin said his own work for Lindberg began "several months after concluding my Commissioner service" and has "long since ended."
Spokespeople for Forest didn't immediately respond to emails seeking comment. Lindberg has put more than $2 million into PACs supporting the lieutenant governor.
State GOP Executive Director Dallas Woodhouse said he didn't have anything to add beyond what he told The Journal, which was essentially what he has told North Carolina media in the past: The party knew Lindberg wanted some of his donations to the state party to go to Causey, but the party decided to give money to the Causey campaign on its own.
Industry experts in The Journal article expressed concern that Lindberg's practices expose insurance policyholders to "an unusual and potentially risky strategy."
The Journal said Lindberg bought an insurance company in Alabama in 2014 and quickly moved it to North Carolina before pulling tens of millions of dollars out of it and lending that money to some of his other companies. The newspaper said state regulators made a rare exception for him, letting him do this with a higher percentage of the company's money than is typically allowed.
A department spokeswoman declined to comment, citing the federal investigation, the newspaper reported. State regulators eventually objected, though, and The Journal said Lindberg responded by creating new entities to borrow from the insurance companies, which would then lend the money to a third Lindberg company.
The Journal also reported that Lindberg bought a home in north Raleigh last year for $5.5 million by relying, in part, on a $3.3 million loan from a company that he's president of. The sale was said to be the largest private home sale in city history.