Just as Jeb Bush increasingly generates speculation about running for president, a controversial business venture that has dogged him for years is popping back up in federal court.
United States vs. MWI Corp. is scheduled for trial in Washington in October, more than 15 years after the start of a legal fight that has produced allegations of fraud against the U.S. government, bribery of Nigerian officials and plenty of fodder for the former governor's rivals.
Bush was the 35-year-old son of a soon-to-be U.S. president when in 1988 he started working with the Deerfield Beach-based MWI Corp. selling water pumps across the globe. Over the next five years until shortly before running for governor in 1994, he earned about $650,000 in a venture that would eventually cause him "unmitigated grief," as he put it years later.
When the federal trial starts Oct. 21, however, the allegations of bribery, corruption in Nigeria and even Bush's role in the business won't be part of the trial.
Bush had been listed as a potential witness, but MWI objected and a federal judge recently agreed his testimony was largely irrelevant and likely would produce a "distracting minitrial." Likewise, the judge is barring testimony about alleged bribery and accusations that MWI officials tried to hide assets from creditors as not relevant to the "narrow factual issues" to be examined by the jury.
The case centers on a 1992 deal to sell water pumps to Nigeria, financed with $74.3 million from the Export-Import Bank of the United States, or Ex-Im. It was a huge coup for MWI, more than four times the annual sales of the company run by David Eller, a top Republican fundraiser who formed a company with Bush, Bush-El Corp., to market MWI's pumps.
The government contends that in applying for Ex-Im loans, MWI fraudulently concealed that the deal would include a "highly irregular" $28 million in commissions for the company's Nigerian sales agent. The Justice Department argues Ex-Im never would have approved the deal had Ex-Im known of that payment.
Even though Nigeria paid the money back plus $33 million in interest and fees, MWI should repay the full $74.3 million in damages, the Justice Department argues, noting that the excessive commission meant less Ex-Im money available to help other U.S. companies and "excess commissions raise the risk of bribes or other illegal activity."
MWI maintains the $28 million in commissions — about 38 percent of the entire deal — were reasonable and appropriate given the work their Nigerian agent, Alhaji Mohammed Indimi, put into the project. They also contend that the U.S. government suffered no damages because the loans were repaid. Indimi has since moved into the oil business and is one of the richest men in Africa.
"MWI has steadfastly denied any wrongdoing and vigorously defended itself in connection with this civil case, which has now spanned 15 years. We are confident that, when this case goes to trial this fall, we will be fully vindicated and will finally be able to put this matter to rest," MWI told the Tampa Bay Times in a statement which went on to applaud a federal judge for excluding "completely irrelevant" testimony from or about Bush.
Bush traveled to Nigeria on behalf on MWI in 1989 and 1991 but has insisted he had nothing to do with the Ex-Im loans. He says he received no commissions based on the Nigerian deal because he wanted to avoid any perception of a conflict with his father in the White House.
"Gov. Bush has answered questions and refuted inaccurate claims made regarding this case multiple times. Nothing alleges any wrongdoing by Bush-El or that Bush-El was even involved in this transaction," said Jaryn Emhof, a Bush spokeswoman.
"While a marketing agent for MWI/Bush-El, he received no commissions from any sales by MWI to any countries (including Nigeria) in which Ex-Im Bank government financing was involved," Emhof said. "Gov. Bush was not on the Department of Justice's witness list, and neither he nor Bush-El were ever mentioned in the complaint, as noted by the judge. Given these facts, the courts have specifically ruled that Gov. Bush's testimony is irrelevant to the case."
But Bush has been dogged by questions and political attacks over his work with MWI and connection to the Nigerian sales.
The old business venture diminished as an issue for political opponents after Bush was elected governor in 1998, but the looming trial serves as a reminder of the sort of scrutiny he is sure to endure should he decide to run for president in 2016.
A former MWI vice president, Robert Purcell, sued the company in 1996, alleging that profits were diverted to the Bush-Eller partnership. That lawsuit was settled in October 1998 — in the midst of a heated governor's race and just days before Bush was scheduled to give a sworn statement. Purcell and his attorney declined to comment for this story.
Purcell also filed a federal whistleblower lawsuit, alleging that MWI defrauded the government in securing Ex-Im's backing. The Justice Department in 2002 agreed to pursue the case but amended Purcell's complaint to exclude some of his more sensational allegations.
Separately, the FBI launched a criminal investigation into MWI's Nigerian pump deal, but it never went anywhere.
Under the federal whistleblower law, MWI could be required to pay three times the damages the jury determines the government suffered — potentially more than $220 million.
Times researcher Natalie Watson contributed to this report.