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Donor's dollars passed to charity

Sen. John McCain and the Republican Party of Florida have given to charity several thousand dollars in political contributions from a Tampa Bay area man who recently lost an investor lawsuit in Oregon that accused him of mishandling millions.

Last month, Craig Berkman, 66, of Odessa was found liable of negligence and breach of contract to a group of more than 50 investors who took him to court several years ago over three venture capital funds Berkman ran in Oregon. The jury awarded investors $28-million in total damages last month.

In the midst of his legal troubles, Berkman and his wife contributed more than $50,000 to Republican causes during this election cycle, according to federal and state campaign finance records, first reported in the Willamette Week in Oregon.

In an article in the St. Petersburg Times in early 2006, shortly after he moved to Florida, Berkman addressed a lawsuit alleging he misappropriated $33-million of his investors' money. At the time, the former head of Oregon's Republican party said he had no plans to get involved in state politics.

However, in July 2007, he contributed $15,000 to the state Republican Party. And he was listed as a one of a dozen hosts for a luncheon honoring Sen. John McCain at the Tampa Club on Jan. 29, the day of Florida's primary. Other hosts included Hillsborough County Commissioner Mark Sharpe and Hillsborough Sheriff David Gee. Gov. Charlie Crist and Sen. Mel Martinez were featured guests.

Berkman didn't return calls for comment Wednesday and wouldn't allow a reporter into his gated community in Odessa.

Al Austin, a Tampa developer and top Republican fundraiser, who helped arrange McCain's Tampa event, said he considers Berkman an honorable guy, checked out his business problems from Oregon and even invested in one of Berkman's ventures.

Austin said that Berkman is appealing the ruling in Oregon.

After reading a story about Berkman's troubles, Austin said he wants to give Berkman an opportunity to explain, but if the article is correct, "that would definitely change my opinion."

The McCain campaign donated $4,600 in contributions from Berkman to the American Red Cross upon learning of the issue, campaign spokesman Jeff Sadosky said.

The Republican Party of Florida said Wednesday it will donate Berkman's $15,000 contribution made last July to Derrick Brooks Charities, state party spokeswoman Erin VanSickle said.

Berkman also contributed $2,000 to former Rep. Katherine Harris in 2004 and $2,100 to Rep. Gus Bilirakis in 2006. Saying Bilirakis is "committed to transparency and accountability," his campaign will donate $2,100 to Operation Helping Hand, political director Nick Hansen said.

Despite making headlines in Oregon, Berkman kept a lower profile in Florida. Few of the state's top political fundraisers and lobbyists said they knew or had heard of him.

In a court record posted on the Internet by the Willamette Week, Berkman disclosed a negative net worth of $11.9-million. His $5.8-million assets included stocks and bonds from a company called EndoVascular Instruments worth $1.3-million. But he reported $17.8-million in loans and mortgage.

Berkman is listed as a board member of a Christian-oriented nonprofit in Tampa, Lifework Leadership Tampa Bay. The company didn't return a call for comment.

In 2006, Berkman denied that the lawsuit had anything to do with his move to Florida. He said business and family interests brought him. His wife, Mary Ann Farrell Karlsson, grew up in Jacksonville and has been living in the Tampa Bay area, he said. She represented New York in the 1985 Miss America pageant.

Berkman told the Times in 2006 that he borrowed from the venture capital funds. However, he said it was legal and he repaid the debt.

The investors, who took control of the funds from Berkman in 2004, said their $75-million investment has dwindled to $15-million.

The largest single investor was British Columbia's public pension fund.

Berkman paid $3.9-million in late 2005 for his home, an 8,600-square-foot Mediterranean-style house on a 2.5 acres that is now worth $2.5-million, according to the Hillsborough County Property Appraiser's Office.

Times staff writer Adam Smith and Times researcher Carolyn Edds contributed to this report.

. fast facts

Craig Berkman

Age: 66; born in Sioux City, Iowa.

Profession: venture capitalist and manufacturing executive. U.S. Army captain 1967-69. Ran unsuccessfully for governor in Oregon in 1994.

Education: Law degree and master's in public administration.

Controversial contributions

Controversies surrounding donors have forced other presidential candidates to return donations. A sampling:

• Former GOP candidate Mitt Romney's campaign returned a $2,300 contribution from Alan B. Fabian, a Maryland contribution bundler indicted on fraud and money laundering charges.

• Presumptive Democratic nominee Sen. Barack Obama has given to charity more than $32,000 raised for his Senate campaigns and political action committee by Antoin Rezko, a bundler who was indicted on charges of influence peddling at the Illinois Statehouse and fraud in business.

• Former Democratic candidate Sen. Hillary Clinton's campaign returned $850,000 in contributions linked to disgraced fund-raiser Norman Hsu.

Donor's dollars passed to charity 07/23/08 [Last modified: Saturday, July 26, 2008 2:33pm]
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