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Perot's Wealth Stretches Across U.S., Files Show

May 20, 1992|SARA FRITZ and RONALD J. OSTROW | TIMES STAFF WRITERS

WASHINGTON — Texas billionaire Ross Perot, complying with a federal law that requires all presidential candidates to disclose their financial assets, Tuesday demonstrated that without a doubt, he is by far the richest man ever to seek the White House.

Perot, whose total assets are believed to exceed $3 billion, reported that he and his wife have invested hundreds of millions of dollars in a wide variety of corporations, real estate, venture-capital funds and municipalities across the United States.

In fact, his investments are so extensive that there would likely be few decisions to come before him as President in which he would not have a personal financial stake.

Stephen Hess, presidential scholar at the Brookings Institution, noted that Perot's enormous wealth distinguishes him from other rich men who have previously been elected President. "We have had an awful lot of rich presidents, but not stinking rich presidents," he said.

By comparison, President Bush, who by any other measure would be considered a wealthy man, is worth less than $4 million. Arkansas Gov. Bill Clinton, the presumptive Democratic presidential nominee, has reported total assets of less than $600,000.

Among the modern presidents, John F. Kennedy and Franklin D. Roosevelt both came from very wealthy families, but neither had personal assets approaching those of Perot. Likewise, the family wealth of former Vice President Nelson A. Rockefeller and diplomat W. Averell Harriman, both of whom sought the presidency unsuccessfully, could not surpass the holdings of the self-made multibillionaire from Texas.

But even billionaires carry huge debt. Perot reported that he owes 24 of the nation's top brokerage and investment houses, including Smith Barney, Goldman Sachs, First Boston, Jeffries & Co., Salomon Brothers and Morgan Guaranty, more than $1 million each for stock purchases and currency trading over the last year. He owes two other investment firms in excess of $500,000.

And he has a $1 million-plus mortgage at 11.13% from New York Life Insurance Co.

Perot's 123-page financial disclosure report, which he filed with the Federal Election Commission, does not provide a precise measure of his wealth. Federal office-seekers are not required to place an exact value on their assets. Instead, they must use a series of eight categories to evaluate their investments, ranging from less than $1,002 to more than $1 million.

In Perot's case, these categories are particularly useless in determining his total wealth because the vast majority of his assets are valued in the top category: more than $1 million. In fact, many of his individual investments are so valuable that they generated income approaching $1 million each in the last year.

Perot is heavily invested in municipal bonds--most of them valued at more than $1 million--issued by hundreds of municipalities stretching from the western slope of Alaska to the southern tip of Florida. Not surprisingly, many of his bonds were issued by municipalities and school districts in his home state, but he also owns at least $1 million in bonds from Compton, Calif., and a similar amount in California water bonds. Income generated by municipal bonds is generally exempt from federal and state income taxes, making these bonds a particularly good investment for super-rich investors such as Perot. He was not required to disclose how much he pays in federal or state income taxes.

Perot reported having checking accounts at several banks, including one at NationsBank in which he keeps more than $1 million. His real estate investments include thousands of acres of undeveloped land in Texas, much of it located at highway intersections.

The report shows that he deals extensively in foreign currency contracts in the German deutsche mark, the British pound, the Australian dollar, the Swiss franc, the French franc and the Japanese yen. All of those transactions occurred in 1992, and all exceeded $1 million.

Perot serves as a president, chairman, director or general partner in 10 organizations that are part of his financial empire. They include two private foundations--the Perot Foundation and the Perot Family Foundation, both in Dallas; the Perot Systems Corp. in Herndon, Va.; four investment corporations, Perot Investment Management Corp., Perot Systems Family Corp., Hill Air Corp. and Petrus Management Corp., all of Dallas; HWGA Ltd. and Keller Associates, both Dallas partnerships; and NeXT Inc., a Redwood City, Calif., corporation, which he left in June, 1991. He stepped down as president of Perot Investment Management last April.

Perot holds a partnership interest in Berry Cash Southwest Partnership, a venture-capital fund that invests in various start-up and technology companies. The interest on his investment was reported to be between $100,001 and $250,000. Berry Cash invests in firms that produce banking software, semiconductors and military avionics.

Through Perot Investment Trust V, Perot also holds an interest valued between $100,001 and $500,000 in Criterion Venture Capital Partners, a venture-capital fund for various start-up and emerging companies.

Some Perot investments are highly complex. For example, Perot and Perot Investment Trust V own equity interests in Landmark Equity Partners II, known as LEP. LEP, which buys secondary interests in venture-capital portfolios, currently holds three portfolios obtained from Harvard University, Northern Telecom and Baxter Travenol. These three portfolios, in turn, hold direct investments in operating companies, which are listed in 62 pages of Perot's report to the FEC.

BUSH, CLINTON VICTORIOUS: Two candidates win Oregon and Washington primaries as Perot garners significant write-in vote. A11

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