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Nelson attack on Chiles backfires

Published Oct. 17, 2005

Gubernatorial candidate Bill Nelson tried again Tuesday to question past financial dealings of his Democratic rival, Lawton Chiles. But records and interviews suggest that Nelson's latest volley might have missed.

It was the fifth time in recent weeks that the Melbourne congressman has called a news conference to complain about what he termed Chiles' "pattern of secrecy" in disclosing details of his personal finances. This time, Nelson found himself defending his tactics, as well as his own disclosure record.

The St. Petersburg Times reported Tuesday that a state prosecutor once criticized Nelson for failing to disclose several key facts in a sworn statement Nelson gave during a corruption investigation into one of his campaign supporters. When questioned about the incident Tuesday, Nelson said again that his 1986 affidavit essentially was complete.

Some reporters questioned why Nelson is spending so much time talking about Chiles' personal finances.

Nelson said that as long as Chiles keeps making an issue of campaign contributions, he will keep talking about Chiles' personal finances. Unlike Nelson, Chiles, a former U.S. senator, refuses any campaign contributions larger than $100.

"If he (Chiles) can speak about one set of disclosure laws, then certainly I will speak about other sets of disclosure laws," Nelson said.

In Nelson's latest attack, he said that Chiles should have disclosed that he had received a gift in the early 1980s, when a Panhandle businessman, Harold C. Hodges, transferred real estate to a corporation in which Chiles was a minor investor. Nelson charged that the only purpose of the company "seemed to be to hide gifts" to Chiles.

But Chiles campaign officials said Nelson's allegation was untrue. They said the transfer wasn't a gift and did not have to be disclosed. Campaign aide Jim Krog said Chiles never made any money on the corporation, and he offered tax records showing that Chiles suffered repeated losses.

The U.S. Senate Select Committee on Ethics issued an opinion letter in 1985 saying that similar transactions involving partnerships are presumed to be business transactions and not gifts.

Chiles aide Julie Fletcher said that a temporary increase in the stock's value in 1981 occurred because the company had won a big cypress-cutting lease, not because it received the real estate.

A Walton County lawyer who was an investor in Cypress Products termed Nelson's charge "ridiculous." The lawyer, George Ralph Miller, said Cypress Products was formed to harvest cypress on land owned by St. Joe Paper Co., Florida's largest landowner. After that deal fell through, Hodges, who was president of Cypress Products, transferred part of his interest in the real estate to Cypress Products, Miller said.

The reasons for the transfer remain unclear. In a deposition used in Miller's divorce, Hodges said he made the transfer as a "gift to my friends" because the company's original business had collapsed. However, Miller said the transfer might have been made for tax reasons.

Miller said Cypress Products eventually went bust, when Hodges borrowed money on the company's land to enter into a gas pipeline venture that failed.