With all the budget news on Wednesday, I didn't get to link to this story in the Los Angeles Times, which reports that the husband of Assemblywoman Diane Harkey, a freshman Republican, is being targeting in a lawsuit accusing him of bilking investors out of millions of dollars.
From the Times:
In an added twist, the investors claim that their money helped fund the election of Harkey's wife, state Assemblywoman Diane L. Harkey (R-Dana Point).
The lawsuit accuses Dan Harkey of using slick marketing techniques -- including mass mailings and DVDs of sales meetings -- to attract investors in short-term, high-interest loans to real estate developers. It contends that Harkey exaggerated the value of the properties used as collateral by borrowers, making the individual investments appear much safer than they were.Dan Harkey denied wrongdoing, saying any losses were related directly to the downturn in the real estate and financial markets.
Assemblywoman Harkey declined to be interviewed. A spokesman disputed the lawsuit's claim that she used investor money to bankroll her campaign.
Harkey spent more than $1.1 million of her own money in two campaigns (a losing Senate bid in 2006 and a winning Assembly bid in 2008.
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