BOSTON (AP) — Gov. Deval Patrick is defending a telephone call he made last month to a top official at Citigroup Inc. on behalf of the owners of Ameriquest Mortgage, a lender on whose board of directors Patrick once served.
Patrick said in a statement to the Boston Globe that he made the Feb. 20 call to former U.S. Treasury secretary Robert Rubin not as governor, but after a personal request to him from a top official at ACC Capital Holdings, the owner of Ameriquest Mortgage.
Patrick vouched for the "current management and the character of the company," spokesman Kyle Sullivan said.
Patrick told Rubin that he was serving as a personal reference for ACC as its owners sought a cash infusion from Citigroup to stabilize the struggling lending firm, Sullivan said.
"They had a very short phone conversation lasting only a couple of minutes," Sullivan said. "He did not advocate in any way for a deal between Citigroup and ACC Capital. He simply offered himself as a reference."
Patrick was asked to make the phone call by Adam Bass, senior executive and legal counsel to ACC Capital, Sullivan said.
Patrick was criticized during his campaign for governor last year for his connections to Ameriquest, which has been accused in the past of predatory lending. The Democrat resigned last July from the ACC board after serving nearly two years, for which he was paid $360,000 a year.
The call is unusual because the governor would usually be reaching out to a top executive of a large company on behalf of the state, said Pam Wilmot, executive director of government watchdog group Common Cause Massachusetts.
Wilmot questioned why Patrick would place a call to a corporation with extensive interests before the state.
Citigroup, the world's largest financial company, has business interests in Massachusetts, many of which are regulated by the state. Ameriquest is licensed by the state Division of Banks.
"When a governor calls a company, particularly one that does business with the state, and asks it to do something, the company is going to feel pressure to act," Wilmot said. "They are going to ask, 'If I do this, will I get a favor?' and, 'If I don't, will there be any penalty?' Those questions should not be on the table at all, and, regardless of the answer, the very questions themselves create an appearance of conflict of interest."
Wilmot said such a call puts a company in an "uncomfortable and untenable position."
Just over a week after Patrick's call, ACC Capital announced it had reached a deal under which Citigroup would provide a needed cash infusion and credit line to the struggling mortgage firm, which provides high-interest mortgages to high-risk buyers.
The agreement also gives Citigroup an option to buy companies owned by ACC Capital, but not Ameriquest.
