Berman attacks Sherman over (legal) loans practice
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Rep. Howard Berman, trying to come from behind in his fight with fellow Democratic Rep. Brad Sherman for a San Fernando Valley congressional district seat, Monday slammed Sherman for having earned interest on loans he made to his campaigns over the years he has been in office.
The practice is legal and not uncommon; but Berman strategist Brandon Hall said he has found that the matter resonates with voters, and the campaign will begin using the issue in TV ads and political mailings.
In a telephone news conference with reporters, Hall said he believes voters think it “inappropriate for a member of Congress to view their campaign accounts as investment vehicles.”
He said Sherman earned nearly $461,000 in interest on loans he made to his campaigns over more than 20 years in elected office. The Berman campaign launched a website, www.Sherman-Scam.com, to help make its case to voters.
The accusations are “false at worst and highly misleading at best,” the Sherman campaign responded, adding that Berman was “trying to distract voters from his own astonishing recording of abusing public office to enrich himself and members of his family.” Sherman consultant Parke Skelton rattled off a list of “abuses” on Berman’s part, including taking 176 free trips abroad and upgrading to first class flights at taxpayer expense, among others.
Monday’s volley signaled that an already contentious election is about to get even nastier.
Skelton said Sherman lent his campaign money beginning early in his career and earned less — averaging under 2% a year — than he would have had he invested the money elsewhere. Hall noted that Sherman appears to have stopped the practice recently and suggested he did so because he realized it could “create a perception problem with voters.’
Other members of Congress have collected interest from loans they made to their campaigns. Rep. Grace F. Napolitano (D-Norwalk), for example, lent her campaign $150,000 in 1998 and had collected more than $158,000 in interest by early 2009.
But Berman supporters say they have found no other House member who has earned as much from self-lending or who kept the loans on the books for long periods.
Hall took care to point out that he was not accusing Sherman of doing anything illegal and said it would be “up to voters” to decide about the ethics of the practice, which Hall called a “scheme of personal enrichment.”
Berman finished second, 10 points behind Sherman, in the seven-candidate June primary. A recent poll taken for KABC-TV showed Sherman with a 13-point lead.
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