As it sought to recruit well-heeled investors, an untested and unprofitable Miami company named InnoVida brought aboard a trusted Florida figure in 2007: Jeb Bush, the former governor and the brother of a sitting president.
For potential stockholders, the imprimatur of Bush, who joined InnoVida as a paid consultant and a member of the board of directors, conferred credibility on the young startup.
It turned out that the leaders of InnoVida, a manufacturer of inexpensive building materials, had faked documents, lied about the health of the business and misappropriated $40 million in company funds, records show. The company went bankrupt in 2011, its founder eventually went to jail, and investors lost nearly all of their money.
Bush left public office seven years ago with a net worth of $1.3 million and an unapologetic determination to expand his wealth, telling friends that his finances had suffered during his time in government.
But his efforts to capitalize on his resume and reputation have thrust him into situations that may prove challenging to explain should he mount a Republican campaign for the White House. Records and interviews show, for example, that Bush participated in the fevered, last-ditch efforts to prop up Lehman Bros., a Wall Street bank weighed down by toxic mortgage-backed securities. As a paid adviser to the company in the summer of 2008, he met with Carlos Slim Helú, a Mexican billionaire, as Lehman sought to persuade Slim to make a sizable investment in the firm, emails show.
Bush was on the board of Swisher Hygiene, a soap maker, at a time when, its executives acknowledged, their financial statements were unreliable and their accounting practices inadequate. That admission contributed to a plunge in stock price that has wiped out more than three-quarters of Swisher's value and touched off a wave of shareholder lawsuits. Several have named Bush as a defendant, accusing him and fellow board members of insufficient oversight.
And in a stint that could complicate his appeal to conservatives, Bush serves as a paid director to Tenet Health, the giant hospital owner, which supported President Barack Obama's Affordable Care Act, aggressively encouraged Americans to sign up for insurance under the program, and trumpeted the legislation as a boon to the company's finances.
The path from public service to private riches is well trodden by politicians of both parties. But even by that measure, Bush took an aggressive and expansive approach to making money.
Since 2007, he has left few corners of the economy untouched, working on Wall Street, starting a consulting firm, investing in real estate, advising an emergency preparedness company, joining the board of a hospital linens provider, and giving speeches to grocery industry groups, local chambers of commerce and education conferences.
He has been well paid for his time, earning at least $3.2 million in board fees and stock grants from publicly traded companies alone, records show. His corporate speechmaking appears to have generated millions more: He commands about $50,000 for his speeches and has delivered more than 100 since 2007, though some are unpaid. And he has earned millions from his work as an adviser to Lehman Bros. and Barclays, the company that took much of the bank over, according to executives familiar with his arrangements. Today, his pay from Barclays exceeds $1 million a year, these people said.
Bush declined to be interviewed. His spokeswoman, Kristy Campbell, provided a statement: "Jeb Bush had a successful career in commercial real estate and business before serving as Florida's governor. After eight rewarding years in public service leading the state, he is enjoying running his own business again."
His business endeavors are a largely overlooked chapter in a postgovernment biography built around his reputation as a policy maven, nonprofit leader and moderate voice in Republican debates on immigration and education. But as he explores a White House bid, friends said, Bush's lucrative career is a potent factor in his decisionmaking. Entering the 2016 Republican field would inevitably require dismantling the business empire that he has assembled — an empire that now employs his son, Jeb Bush Jr.
"Although he's been at this for seven years, it's the last few years that he's begun to flourish as an investor and build a commendable nest egg," said Al Cardenas, a longtime Bush friend and adviser. "Leaving all of that behind, all he's built, is a challenge and a sacrifice for him."
His overlapping commitments risk spreading him thin. At one point, Bush was on the boards of six companies, twice as many as leading corporate governance experts recommend, given the time and fiduciary responsibilities of such a position.
Fellow corporate board members are quick to praise Bush. At Tenet, they said, he has pushed for tougher hospital safety standards; at Rayonier, a major owner of forestland, he has advised them on navigating regulations.
Eye-popping wealth long eluded Bush. His older brother, George W. Bush, reaped a nearly $15 million profit from an investment in the Texas Rangers baseball team. But Jeb Bush's career as a real estate entrepreneur in Florida brought him comparatively modest success: He entered the governor's office in 1999 with a net worth of about $2.4 million, according to his financial disclosure forms, a figure that fell throughout his two terms.
"People thought of him as wealthy," said Lance deHaven Smith, a professor of political science at Florida State University who has studied Bush's career. He recalled that when Bush was governor, his opponents took to calling him a "spoiled little rich kid" to protest his budget cuts.
"It was a misperception," deHaven Smith said. "He grew up in a wealthy family, but he took a path that was quite different."
He seemed eager to change that by 2007, expressing frustration to business and political associates that he had missed out on a real estate boom during his time as governor; he also turned down a public pension when he left office.
Within a year of departing the statehouse, he had signed on as consultant to Lehman Bros., where he was eventually enlisted to reach out to Slim in a plan code-named Project Verde. Slim, however, was not interested in making a major investment in Lehman Bros. or striking up a joint venture with it. "Project Verde was unsuccessful," Bush wrote to a Lehman colleague in early July 2008.
Lehman executives talked openly about the value of Bush's family connections in the midst of the crisis. Lehman's chief executive, Richard S. Fuld Jr., discussed having Bush ask his brother, President Bush, to persuade the British prime minister to allow Lehman's emergency merger with a British bank, according to testimony from the company's bankruptcy case. Fuld never followed through, and Bush did not call the president, a spokeswoman for him said.
Friends and colleagues said Bush carefully evaluates businesses before working with them. In the case of InnoVida, an aide said, he ran a background check on the founder, a flashy, Maserati-driving businessman named Claudio Osorio. It turned up the bankruptcy of a previous company, the aide said, but nothing to suggest wrongdoing. So Bush agreed to help market his technology, a construction system that required no concrete, steel or wood.
There is no evidence that board members were aware of Osorio's fraud. But Christopher Korge, an investor in the company and board member, said he recalled talking to Bush about their shared frustration with the company's delays in distributing financial information and reluctance to hold regular board meetings.
In separate interviews, a lawyer for Osorio, who pleaded guilty, and a lawyer for a group of investors argued that members of the board had exercised little meaningful oversight of the company.
"It was done lackadaisically," said David A. Nuñez, the lawyer whose clients lost millions when InnoVida collapsed. If board members "did their due diligence, really did it, they would have been able to determine this company was not financially solvent and that it was a fraud," he said.
Korge, a major Democratic Party fundraiser who lost millions on his investment in InnoVida, said that once he alerted Bush to major problems inside the company, the former governor acted swiftly and forcefully to investigate them. "Jeb did everything that he should have done to protect the shareholder," he said.
Most of Bush's career in business has steered clear of politics, allowing him to carefully hone a potential campaign message by delivering speeches, granting television interviews and writing a book. But not all of his corporate work is in sync with his public brand.
Bush opposed the Affordable Care Act and has called it "flawed to its core," just like many of his potential rivals in the 2016 campaign. But unlike them, he has earned more than $2 million for being on the board of a company, Tenet Health, that has loudly endorsed the legislation.
Tenet's chief executive, Trevor Fetter, said that at company meetings Bush had made no secret of his objections to the health care overhaul. But he suggested that Bush understood the difference between "personal views and what is best for the company." Fetter predicts that in 2014, the Affordable Care Act will deliver up to $100 million in new earnings for Tenet.