VIDEO PREVIEW: Coming Thursday - Nicholas Schorsch Part III
GoLocalProv News Team
VIDEO PREVIEW: Coming Thursday - Nicholas Schorsch Part III
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLAST
Over his career, Schorsch has been a business power player, first in Philadelphia and then in New York City.
Each time, he enjoyed business success, which was followed by allegations and enforcement actions by regulators.
On Thursday, GoLocal publishes PART III in the series, looking at the man making such a big impact.
WATCH VIDEO ABOVE
Early in Schorsch’s career, he was an owner and the operator of a number of interrelated companies — businesses that were cited for a string of environmental and safety violations.
Under Schorsch’s leadership, the federal safety agency OSHA and an environmental regulatory agency repeatedly fined Schorsch’s company for violations from 1983 through 1990.
After one enforcement action by OSHA, Schorsch ridiculed the agency; he told the Philadelphia Inquirer, “As far as we’re concerned, the allegations are completely false. They [OSHA] have to do something to justify their salaries. They have been out here for months. Obviously, they’re not finding what they are looking for, and they are getting irritated.”
However, months later, as the Inquirer reported, Schorsch signed a 23-page consent decree that “described an extensive effort to hinder and obstruct OSHA investigation from mid-May to mid-August. Further, the company admitted it had 'carried out a predetermined, systematic plan' to prevent OSHA inspectors from observing and photographing production processes and taking air samples. Schorsch and the company admitted that they gave 'the clear impression that anyone caught talking to OSHA inspectors would be disciplined or fired.'"
Less than two months later, OSHA announced another enforcement action. According to a report in the Inquirer, “OSHA inspectors found layers of lead dust throughout the plant, resulting from poor ventilation in the work areas, the citation says. Dust samples were taken from the lunchroom, a water fountain, and a vending machine. Lead dust was discovered on the employee's personal clothing.”
The most disturbing thing was that ”of the 118 employees tested this month, OSHA contends 51 either had the maximum level of lead in their blood or exceeded the maximum.”
In New York, Schorsch had a meteoric rise in the commercial real estate REITs industry.
He became a billionaire, his company went public and then nearly just as quickly it all unraveled. The SEC took action, lawsuits pilled up, and one of his close associates was sentenced to federal prison.
"REIT managers and their professionals have an obligation to tell the truth when making disclosures to shareholders about their compensation," said Marc P. Berger, Director of the SEC's New York Regional Office. "As we allege in our complaint, AR Capital and its partners Schorsch and Block failed to do so and benefitted themselves greatly at the expense of shareholders."
COMING THURSDAY - PART III
Schorsch takes on Newport and becomes a major player — and becomes an important donor to powerful politicians in Rhode Island.