Rep. Issa's Career Has Been Driven By Greed And A Desire For Power

June 01, 2010 10:33 am ET

As Rep. Darrell Issa (R-CA) continues his campaign for an investigation into the non-issue of a job offer to Rep. Joe Sestak (D-PA), Issa's past becomes less of a biographical footnote and more an indication of the life patterns of a man used to hostile takeovers and accustomed to using his wealth to further his ambition.

A Ruthless Businessman

AC Custom Electronics

Issa Went To Court To Assume Control Of AC Custom Electronics.  The Los Angeles Times reported:

[Joey] Adkins started work in the late 1970s on anti-theft devices for automobiles, developing a product called Steal Stopper that killed the ignition switch unless a digital code was entered. His company, A.C. Custom Electronics, secured a contract with Ford Motor Co. and, by 1981, was reporting nearly $ 1 million in annual revenues, tax returns show...

In 1980, after leaving active military duty, [Issa] bought into Quantum Enterprises, which had previously manufactured CB radio parts. When the CB market began dying, the company resorted to developing gadgets, such as a potato peeler, but it suffered what Issa described as "incredible losses."

The company also had begun doing electronics work for Adkins. The relationship went smoothly until Adkins turned to Issa for a $ 60,000 loan that would eventually cost him his business after Adkins pledged his company's stock as collateral.

A similar loan from Issa was repaid the previous year. But this time, Adkins asked for a few more weeks to repay the loan--and Issa says he agreed.

Within days, however, Issa went to a judge and--under an Ohio law that did not require the debtor to be present--won a judgment for the outstanding $ 60,000.

Issa promptly called Adkins at home to declare that he now owned his auto security company, Adkins recalled. "I was completely floored," he said. [Los Angeles Times, 5/23/98, via Nexis]

"Issa Had Been Scheming From The Start To Take Over" The Firm.  According to the Los Angeles Times:

Issa says he learned only after extending the loan that Adkins' company was saddled with mounting debts and was bordering on insolvency. Rather than risk losing his investment, he said he went to court for protection.

"We had every right to do so," he said. "There wasn't any stealing of any company."

...But Adkins said A.C. Custom was on solid financial ground and could have paid off the note as agreed.

Moreover, he charged that Issa had been scheming from the start to take over his company--a charge buttressed by Adkins' former bookkeeper.

The bookkeeper, Karen Brasdovich, said Issa had grilled her about Adkins' finances, including his late payment of bills. Only later, she says, did she suspect that Issa may have then used that information to seize the firm. [Los Angeles Times, 5/23/98, via Nexis]

Issa Brandished A Gun While He Fired An Employee.  According to the Los Angeles Times:  "One of Issa's first tasks as the new boss was to remove an executive named Jack Frantz. According to Frantz, Issa came into his office, placed a small box on the desk and opened it. Inside, he said, was a gun. 'He just showed it to me and said 'You know what this is?' Frantz said. Issa invited Frantz to hold the gun at one point and told him he had learned about guns and explosives during his military days, Frantz said. Because he was about to be fired, Frantz said he saw it as 'pure intimidation.'" [Los Angeles Times, 5/23/98, via Nexis]

AC Custom Fire: Flammable Liquid Had "Been Poured On The Only Area Not Covered By Fire Sprinklers."  The Los Angeles Times reported that "seven months after Issa took control," a fire broke out at the "Quantum manufacturing plant."  "Case files from Maple Heights, the Ohio fire marshal and insurers pointed repeatedly to the likelihood of arson in the blaze, which officials estimated caused $ 800,000 in damage. Although an accident could not be ruled out, the uneven and unnatural burn patterns made the blaze 'suspicious in nature,' the state concluded two months later. Flammable liquid appeared to have been poured on the only area not covered by fire sprinklers, investigators found." [Los Angeles Times, 5/23/98, via Nexis, emphasis added]

1985 Merger With Astro-Guard

Issa's Former Business Partner: "Issa Tried To Run The Company Into The Ground." According to the Los Angeles Times, "In 1985, [Bob] Raines' home alarm company, called Astro-Guard, acquired Issa's company. Issa ran the merged operation as president, but he and Raines soon clashed over money. Raines maintains that Issa tried to run the company into the ground after Raines refused to sell out. The two parted ways in a split that Issa described as 'amicable.'" [Los Angeles Times, 5/23/98, via Nexis]

  • Bob Raines On Issa: "I Wouldn't Have Any Personal Dealings With Him Again." According to the Los Angeles Times: "Raines says now: '[Issa]'s a real operator. He's so shrewd. I wouldn't have any personal dealings with him again.' Raines said he survived the split only by selling off his boat and his motor home and spending $100,000 in retirement money." [Los Angeles Times, 5/23/98, via Nexis]

Directed Electronics Inc.

1982: Issa Founded Directed Electronics, A Vehicle Security System Firm. According to Directed Electronics' website:  "Directed Electronics was founded in Cleveland, Ohio, in 1982 by Darrell Issa (now a U.S. Congressman representing California's 49th District) and his wife Kathy, as a maker of vehicle security products. In 1986, Directed Electronics moved to Southern California, where the business began to expand rapidly. Automobile theft was rising dramatically, especially in major metropolitan areas, and Directed's commitment to research and development led to advances in integrated circuit-controlled security systems that propelled the company to the forefront of the field." [Directed.com, accessed 1/28/10, parentheses original]

1991: Inc. Magazine Ranked Directed Electronics Inc. #241. Directed Electronics was ranked #241 in the Inc. 500 in 1991. Inc. 500 is an annual "ranking of America's fastest-growing privately held companies." [Inc.com, accessed 1/28/10 and 5/31/10]

2000: Issa Sold Directed Electronics, Inc. Following Years Of Success. According to Directed Electronics' website: "During the 1990s, Directed's sales grew substantially as the company won dozens of awards, developed the first PC-programmable security systems, achieved quarter-mile range from keychain remote controls and entered the burgeoning car audio business. In the year 2000, Directed purchased the Clifford® and Avital® brands and became the unrivalled leader in consumer branded vehicle security and remote start, which continues to this day. At the end of 2000, Darrell and Kathy Issa sold controlling interest in the company to Trivest, Inc., a private equity firm based in Miami, Florida, and stepped down from day-to-day operation of the company." [Directed.com, accessed 1/28/10]

A Calculating Politician

1997: Financed Proposition 209

Issa Provided Funds At "Critical Moment" To Help Pass Proposition 209. According to the Washington Post: "[Issa] was spurred to political action by his outrage at President Bush's 'broken promise' on taxes, and began making big contributions after Bush's defeat. At a critical moment, a $100,000 Issa check kept the petition drive for anti-affirmative action Proposition 209 alive." [Washington Post, 12/21/97]

Issa On A Mission "To Keep America From Turning Into Another France." According to the Washington Post: "'Appalled' by the budget deal congressional Republicans signed with President Clinton this year, he told me, 'It's going to take more Darrell Issas there to keep America from turning into another France.'" [Washington Post, 12/21/97]

  • Proposition 209 "Banned Racial Preferences In All State Institutions." According to the Washington Post: "California's Proposition 209 banned racial preferences in all state institutions." [Washington Post, 7/26/09]

1998: Failed Senate Campaign

Issa Lost Bid For Senate. According to CQ: "In 1998, Issa spent $11 million on a failed bid for the GOP Senate nomination." [CQ Politics in America Profile, accessed 5/31/10]

  • Issa Lost Primary After Spending $10 Million Of His Own Money On Campaign. According to the New York Times: "[I]n the race for the Republican Senate nomination, where the State Treasurer, Matthew Fong, staved off a self-financed $10 million challenge from Darrell Issa, a multimillionaire car alarm manufacturer, to win the right to challenge United States Senator Barbara Boxer." Mr. Fong "defeated Mr. Issa by a margin of 22 percent to 19 percent." [New York Times, 6/4/98, emphasis added]

2000: Elected To The House Of Representatives

After An Expensive, Multi-Candidate Primary, Issa Won Congressional Seat With 61% Of Vote.  CQ reported: "In 1998, Issa spent $11 million on a failed bid for the GOP Senate nomination. He hit the campaign trail again in 2000, when Republican Ron Packard announced his retirement from the 48th District, a reliably GOP district that was home to President Nixon. Issa weathered a nine-candidate primary, sinking $2 million into the race, then won the general election with 61 percent of the vote. His re-elections have been easy in what is now the 49th District." [CQ Politics in America Profile, accessed 5/31/10]

2003:  Financed CA Governor Recall

Issa "Bankrolled The Recall Effort In 2003" That Replaced Gov. Davis With Schwarzenegger.  According to CQ: "Issa bankrolled the recall effort in 2003 that ousted Democratic Gov. Gray Davis and put Republican Arnold Schwarzenegger in his place."  [CQ Politics in America Profile, accessed 5/31/10]

Issa Wanted To Replace Davis; GOP Colleagues Asked Him To Step Aside.  CQ reported: "Although Issa wanted to replace Davis himself, several GOP House colleagues persuaded him to step aside for Schwarzenegger, whom they believed to be more likely to win." [CQ Politics in America Profile, accessed 5/31/10]

After Providing $1.7 Million To The Recall Effort, "Issa Tearfully Took Himself Out Of The Race."  According to USA Today: "U.S. Rep. Darrell Issa, the conservative car-alarm millionaire who had contributed $ 1.7 million to the petition drive for the recall vote, summoned reporters to the San Diego County clerk's office Thursday to watch him file candidacy papers. There, they watched in astonishment as Issa tearfully took himself out of the race. He said he wanted to focus on pushing for peace in the Middle East." [USA Today, 8/8/03, via LexisNexis]

Issa Is The Wealthiest Member Of The House

2008 Ranking: Issa Was Richest Member Of The House. According to the Center for Responsive Politics, Issa has a net worth ranging "from $164,650,039 to $337,400,002," enough to be ranked "1st in House." [Center for Responsive Politics, accessed 2/3/10]

Issa's Career Fundraising Totals Over $16 Million. According to the Center for Responsive Politics, Issa's "total receipts" from 1989-2010 equal $16,253,600. [Center for Responsive Politics, accessed 2/3/10]

  • 69% Of Issa's Campaign Funds Come From His Own Pocket. According to the Center for Responsive Politics, Issa received 17% of that $16 million from "individual contributions," 13% from "PAC contributions," and 69% from "Candidate self-financing." [Center for Responsive Politics, accessed 2/3/10]

Ties To Big Business

Issa Has Received Nearly $40,000 From The National Beer Wholesalers Association. According to the Center for Responsive Politics, Issa has received a total of $38,500 from the National Beer Wholesalers Association (NBWA) in contributions since 2000. [Center for Responsive Politics, accessed 2/3/10]

  • NBWA Was A Leading Supporter Of Bush Tax Breaks. According to the Center for Responsive Politics: "The NBWA...was a leading supporter of President Bush's proposed package of business tax breaks in 2001." [Center for Responsive Politics, accessed 5/31/10]

Science Applications International Corporation (SAIC) Has Given Issa More Than $64,000 Since 2000.  According to the Center for Responsive Politics, Issa has received $64,150 in total contributions from the company Science Applications International Corporation from 2000-2010. [Center for Responsive Politics, accessed 2/3/10]

  • SAIC Produced Faulty Software For The FBI. According to SignOnSanDiego.com: "SAIC's custom software, known as Virtual Case File, was intended to help FBI agents and analysts track terrorists and manage criminal investigations. When SAIC delivered the product, [FBI Director Robert Mueller testified that] at least 400 problems were found with the software." The contract between SAIC and the FBI was worth "170 million dollars." [SignOnSanDiego.com, 2/3/05]

Issa Has Received $27,000 From Merrill Lynch During His Political Career. According to the Center for Responsive Politics, Issa has received $27,000 in contributions from Merrill Lynch over the course of his political career. [Center for Responsive Politics, accessed 2/3/10]

  • Issa Denounced Bank Of America-Merrill Lynch Merger. According to the Washington Times: "Darrell Issa of California, has accused the Towns-led inquiry of covering up the Obama administration's actions in securing billions of dollars of taxpayer support for Bank of America in exchange for the bank's promise not to demand a lower purchase price for Merrill Lynch. The committee's 'time and resources have been redirected to pursue politically convenient scapegoats at Bank of America,' Mr. Issa said. 'These [bailout] funds were a quid pro quo to entice Bank of America to go through with the merger.'" [Washington Times, 11/18/09, brackets original]

 

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