Jesse Jackson Accused of 'Racketeering' by Top Black Businessman

Marc Morano, -- One of America's wealthiest African-Americans, asked by Jesse Jackson to assist with Jackson's "Wall Street Project," says the tactics used by the civil rights leader amounted to "racketeering."

A prominent black broadcast executive says he's been the victim of intimidation at the hands of Jackson and is fighting the Federal Communications Commission's efforts to block the sale of his television stations.

A black entrepreneur seeking aid from one of Jackson's groups describes it as "a boys club to me, an inner circle," that he cannot penetrate.

Officials with Jackson's various interests largely refused to comment on these complaints, which represent a growing number of concerns about some of the methods used by Jackson to advance his agenda.

But increasingly, more African-American business professionals are wondering whether the reverend represents American blacks to the extent Jackson says he does.

Accusations that Jackson 'Stiffed' the Poor

Businessman Harold Doley, Jr. said he thought Jackson "was going to do what he was saying," in launching the Wall Street Project.

Founder and chairman of the New Orleans-based Doley Securities, Inc., and rated as one of the country's 100 wealthiest African Americans by Securities Pro, a newsletter covering blacks on Wall Street, Doley was asked by Jackson in 1996 to help with the Wall Street Project, a program designed to promote minority participation in corporate America.

As the first African American to purchase a seat on the New York Stock Exchange in 1973, Doley was thought to be able to open many doors for Jackson on Wall Street.

"I got to really know Jackson," explained Doley, who added that he shared the project's stated goal of "making corporate America look more like America from the entry level to the board room."

He explained that Jackson's original vision appealed to him. "This is what is appropriate, this is where America needs to be going," said Doley. "I felt what he was doing was good, good for America, and good for my business."

But after initial exuberance about the Wall Street Project, Doley became disillusioned.

Jackson went after the multi trillion-dollar pension fund industry in his quest for minority empowerment and worked for legislation to require 10-15 percent of the nation's pension funds, depending on the state, to be brokered or managed by minority firms.

Doley disapproved of the methods Jackson employed in persuading the pension industry to aid minorities. "What worried me was the way he operated, dealing with these veiled threats," he stated.

Doley soon realized that Jackson's efforts "directing an enormous income from pension [funds]" were only being channeled to "roughly 10 firms that qualify."
He doubts most Americans know "that they were paying and putting money in Jesse Jackson's coffers to the tune of $170 million in commissions a year, 10 percent of which is going to Jackson."

Doley says he was a first-hand witness to how "Jesse in effect stiffed the poor people of America." According to Doley, Jackson gave political cover to a bank merger that "cut out $330 billion dollars" over a 10-year period to poor communities in the U.S. The merger did not meet the minimum standards of the Community Reinvestment Act (CRA), which requires that financial entities do not negatively impact poor areas of the country.

According to Doley, representatives from Operation PUSH and the Wall Street Project went before the Federal Reserve Board and testified that the deal was in the best interests of America, despite the fact they did not meet CRA guidelines.

Doley could not believe Jackson would support a merger that "fell short by $330 billion dollars going into communities in terms of mortgages and services provided by financial institutions. This was a tremendous loss."

According to Doley, Jackson "knew the mega mergers were not meeting the guidelines ... but Jesse was getting contributions because of his support" for the deals.

An incredulous Doley decided to personally confront Jackson about his support of the bank merger. The meeting was not very productive. "I said, 'man, you cannot do this.' And I went over the numbers quickly and he just walked away," Doley recalled. Despite Doley's protestations, the merger was finally approved.

Doley says he then saw Jackson in a completely different light. "What he was doing was a kind of RICO operation, both criminal and civil. It was racketeering."

Doley consulted with several attorneys, confiding that "I am concerned that what is going on here may be illegal." The attorneys' advice was simple: "If you have to ask, get out," they offered.
"I just eased on out," Doley recalled. After spending about two years working with Jackson, he now calls him a "Civil Rights Entrepreneur" whose moneymaking ability is beyond comparison. He noted that in 1996, Rainbow PUSH had a gross income of $695,000 and by the year 2000, it grossed $17 million. "He's done better than any goddamn dot-com stock that I am aware of," Doley said.

His advice for young entrepreneurs who may want to partner with or join one of Jackson's organizations is blunt. "I tell them they could go in the hood and go into a partnership with a crack dealer if all they are interested in is the money," he explained.

When contacted for reaction to Doley's charges about Jackson, press spokeswoman Keiana Peyton of Rainbow PUSH, refused to answer any specific questions, stating only that Jackson's efforts have "opened the market and evened the playing field for persons who have historically been locked out of this access to business and capital."

Powerful Broadcaster vs. Powerful Civil Rights Leader

"I am not giving in to him, I won't give in to his pressure tactics," broadcaster Eddie Edwards of Glencairn Ltd., told Edwards is trying to sell his television station group to Sinclair Broadcast Group, but Jackson has stepped in and petitioned the FCC to try and block the sale.

Edwards, of Pittsburgh, is considered one of America's most powerful black broadcasters, coming in only second to W. Don Cornwell of Granite Broadcasting, according to Media Week magazine.
He traces his troubles back to his decision to start his own Black Broadcasting Alliance (BBA), a competitor to what he calls the Jackson-friendly National Association of Black Owned Broadcasters (NABOB).

The Black Broadcaster Alliance was formed because "NABOB tries to control minorities in broadcasting," according to Edwards. "None of my difficulties began until I started BBA. They really came after me," he explained.

Edwards said Rainbow PUSH attorney David Honig accused him of being a "front man" for Sinclair Broadcasting. Edwards recalled that Honig told him, "You, in short, play by our rules and deal with us or we will get you." But Edwards was not easily dissuaded.

"I am not going to be intimidated. I told them once, twice, a hundred times. I am from the same street they are and I have worked too hard to get where I am and if you think you are going to try and muscle me through words and through manipulating the system, you got another thing coming," he stated.

Jackson petitioned the FCC to halt Edwards proposed sale of 19 television stations to Sinclair and the approval of the deal has been in legal limbo since May of 1998. The deals are estimated to be worth $1.5 billion.

Martin Leader, an attorney for Sinclair Broadcasting, explained that the company has probably "lost millions of dollars" because of the FCC delays.

Edwards bristles at the charge that he is a "front man" for Sinclair. "I don't have to dignify that. My 35 years in the business is second to none," he offered.

Leader said Edwards "owns 100 percent of voting stock [in Glencairn]"

"Sinclair people have nothing to do with Glencairn and the commission has so found that," he added, referring to earlier FCC letters. obtained a copy of the petition that Leader filed with the U.S. Court of Appeals for the District of Columbia on September 10. The petition calls for "prompt action" by the FCC in rendering a decision.

The US Court of Appeals for District of Columbia has ordered the FCC to respond to Leader's petition by November 14th.

"The FCC's inaction on the applications has evidently been caused by the refusal of Sinclair to accept improper demands by the commission to sell broadcast stations to minority purchasers solely because of their race and the resulting hostility that continues at the commission," the petition states.

According to affidavits filed by Leader, the chief of the Mass Media Bureau at the FCC, Roy Stewart, met with Sinclair representatives in April of 1998 and stated, "If you repeat anything that I say here, I will f*****g deny it."

Stewart then allegedly told Sinclair representatives that "Chairman Kennard wanted to see more minority ownership in broadcasting" and made it clear that they did not regard Edwards as a viable minority, according to the affidavits.

Stewart "made it very clear that if Sinclair could do something to assist in [the goal of minority ownership] ... it would be very beneficial to the processing of its applications," the affidavits allege. They also accuse Stewart of threatening Sinclair by stating that if they did not cooperate, "Chairman Kennard would make it 'really painful' for the company."

Leader said the FCC did not see anything wrong with Sinclair or Glencairn business dealings before Jesse Jackson got involved. The FCC had previously approved seven applications between Glencairn and Sinclair.

Edwards maintains "Jesse and his group have strong relationships with individuals within the FCC." He added, "The stations out there that have cooperated with [Rainbow PUSH] had to render favors of some kind and I refuse to play that game."

He noted that the temptation is great to give in to the tactics because "most broadcasters can't afford more delays. Delays cost money." But he remains resolute, declaring, "I am the first black or white person to step up and to speak out [against Jackson]."

"The influence that Jesse Jackson has in Washington, there are people genuinely afraid of this man," Edwards said. However, he added, "Jackson does not represent all black people.

Peyton, a spokeswoman for Jackson, declined to comment on the specific charges made by Edwards and Sinclair Broadcast Group.

She reiterated that Jackson "has worked to even the playing field for minorities and female-owned businesses that have not in the past had access to meet with certain businesses to even showcase their talents and abilities."

Young Entrepreneur Disillusioned

Frederick Jones is a young African American entrepreneur who became disillusioned with Jesse Jackson's Rainbow PUSH organization after multiple attempts to seek aid for his small business.

"The more and more I got into it, I started finding out that if you didn't have ties with the reverend or didn't have money invested, you weren't getting helped," he told Earlier this year, Jones approached Rainbow PUSH with a complete business plan and expected to receive consultation and help.

"Every article I read had these prominent minority business people who are supposed to be so helpful with their guidance, with their time, but nobody returns your phone call, nobody talks to you," he stated.

Jones is in real estate development and information brokering. He explained that he contacted several of Jackson's organizations, including the Wall Street Project, because its goal is to "partner with minority business people and help mentor you and guide you along and help with introductions."

A frustrated Jones said he called many members of Jackson's inner circle, including Chester Davenport of Georgetown Partners, who would not take or return the phone calls.

"I called so many times that [Davenport's] secretary Eunice knew my name and my voice," he stated.

Jones claims Rainbow PUSH tried to extract a $250 small business fee from him and another $250 registration fee for a conference.

In a phone conversation with one of Jackson's organizations, he was asked whether he had "joined Rainbow PUSH." Jones asked, "Is it necessary?"

The answer he received from a woman who refused to identify herself was, "It helps if you are a member of the organization, to get help from them."

Jones said he complained that none of the promotional material said "members only." However, according to Jones, the woman persisted that Jones "should call the Rainbow PUSH offices and ask for a membership package."

Jones has since lost interest in receiving any help from Jackson. "It's a boys club to me, an inner circle," he lamented.

Peyton countered that "every Saturday here in Chicago, we host trade bureau meetings, open to the general public, to come and network. She added "that membership in Rainbow PUSH is recommended but not a prerequisite," to receiving business consulting and support.

But Jones is soured from his experience. "Why would you want to join something that is going to keep you an outsider?"

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