Mitch Perry
Democratic U.S. Rep and U.S. Senate candidate Alan Grayson acknowledged this summer that he manages three hedge funds in his own name, but denied violating congressional ethics rules that prohibit sitting legislators from managing self-named investment entities.
However, documents filed with the Florida Secretary of State’s office Division of Corporations this month show he has filed paperwork to change the names of two of those funds, removing his own moniker.
One form shows that he has requested that the Delaware-based Grayson Fund General Partner, LLC be changed to the Sibylline Fund General Partner, LLC. Another form shows that he submitted paperwork to change the Cayman Islands-based Grayson Fund Management Company LLC to the Sibylline Fund Management Company, LLC.
House rules and federal law state a member of Congress “may not permit [his or her] name” to be used by an entity that provides professional services involving a fiduciary relationship. But Grayson has contended the fund offerings are exempt because all of the funds investors are “qualified investors” and he has no “fiduciary responsibility” over the funds. Some lawyers who specialize in securities law sharply questioned that assertion in a story published by POLITICO in June.
Two ethics complaints against Grayson were filed with the Office of Congressional Ethics in the wake of the initial reporting on the issue. One was filed by the Foundation for Accountability & Civic Trust (FACT) in early July. The other was by St. Lucie County Democratic Party Chairwoman Celeste Bush, an avowed supporter for Patrick Murphy, the South Florida congressman battling Grayson for the Democratic nomination for U.S. Senate in 2016. Bush accused Grayson of failing to properly disclose details of three hedge funds, including their investors and his income from them.
When asked for comment, Grayson spokesman Kevin Franck directed Florida Politics to the response he gave the Tampa Bay Times‘ Alex Leary on Sunday night. “There’s nothing wrong with the investor partnership using ‘Grayson’ in their name, but at this point, it’s simply easier to change the name than to argue about it,” Franck said in a prepared statement.
Joshua Karp, a spokesman for Murphy, said the campaign won’t comment at this time.
Last month, however, Murphy did respond, issuing a prepared statement challenging Grayson about the hedge funds that he controls, and listed a series of questions calling for a response from Grayson.
