|March 15th, 2007, 09:48 AM||#1|
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Obama's Rising Star Hit By Claims of Financial Misdealing
Illinois senator accused of conflict of interest - Campaign team say share deals were above board Barack Obama, a star of the Democratic party and a frontrunner in the presidential race, was forced on to the defensive yesterday over past financial dealings.
Disclosure of his share dealings in two companies - one dealing in pharmaceuticals and the other in communications - was a knock to Mr Obama who is campaigning on a platform of higher ethical standards in politics and tougher restrictions on political funding and lobbying.
Until now Mr Obama, a senator for Illinois, has enjoyed a relatively easy rise and established himself as the main rival to Hillary Clinton for the Democratic presidential nomination.
His campaign team insisted yesterday the share dealings had all been above board and there had been no conflict of interest.
A financial website, TheStreet.com, reported on Monday that in March 2005 Mr Obama bought more than $50,000 (£25,900) of stock in the companies. One of them, AVI BioPharma, was developing a drug to treat avian flu and the other, SkyTerra, a satellite communications business, was expanding wifi access across the US.
Mr Obama opened himself up to accusations of conflict of interest by advocating in the Senate, within two weeks of buying the AVI shares, an increase in federal funding to fight avian flu.
But a spokesman for Mr Obama, Bill Burton, said yesterday that his shares had been held in a blind trust. His stockbroker had bought the shares in the two companies and Mr Obama had no knowledge of them.
Mr Burton said Mr Obama had ended the blind trust after receiving a letter in the mail from a company in which he had shares and "realised he didn't have the level of blindness he expected". He sold the stocks in November 2005, losing about $15,000 on SkyTerra and earned a profit of about $2,000 on AVI.
"Obama owned stock in two companies which he did nothing to help - an investment that lost him $13,000," Mr Burton said. "It's apparent that his dealings were completely above board and his decisions were proactively made in the interest of avoiding the potential for conflict."
Among unanswered questions is why the stockbroker chose to invest in two obscure firms whose major investors included generous contributors to Mr Obama's campaign.
Mr Obama is promoting himself as a new, exciting, different kind of politician, contrasting with Ms Clinton, who has a well-organised political machine behind her raking in political donations.
By Guardian Unlimited © Copyright Guardian Newspapers 2006