The headline in the Wall Street Journal is an attention grabber: “West Virginia Gov. Jim Justice is Personally Liable for $700 Million in Greensill Loans.”
Justice’s companies have a long history of non-payment, slow payment and legal fights over debts. The investigative news outlet ProPublica reported last year that “Justice’s constellation of companies has been involved in more than 600 lawsuits spanning more than two dozen states.”
The latest controversy involving a Justice company is over loans made by Greensill Capital, a private financial firm, to Justice’s Bluestone Resources coal company. As the Journal reported, Greensill, which has since gone bankrupt, packaged the loans and sold them to Credit Suisse.
“Credit Suisse is under pressure to recover money quickly and has named Bluestone as one of three large borrowers from the Greensill funds that it has identified in its recovery efforts,” the Journal reported.
Bluestone has sued Greensill, arguing that the company committed fraud and that the loan repayments were not due until 2023.
As always, the lawyers will have to sort all this out. However, what stands out is the fact that Justice, his wife Cathy, and son Jay, personally guaranteed the loans. The Journal reported Mr. and Mrs. Justice personally guaranteed “unlimited amounts” while their son “guaranteed loans up to a certain amount.”
According to the Journal, the total amount due is nearly $700 million. The personal guarantee puts their family assets on the line. Forbes once listed Justice’s wealth at $1.5 billion. However, the financial magazine now lists it at $450 million.
Justice and his family operate over 100 different companies. Unlike many other elected officials, Justice never placed his assets in a trust, although he says he has turned over the operations of the companies to his children.
However, when questioned about the Greensill issue Tuesday, he did concede the magnitude of the problem. “It is a burden on our family beyond belief.”
He also blamed the private financial firm for the mess. “If you knew all the details, you’d know that evidently Greensill is a bad, bad actor,” he said.
Still, Justice said his focus remains on his daily responsibilities as Governor. “I’m here doing exactly what I do, and I do every day, and I’m proud to do it. That’s what I’m going to continue to do. I’m going to be your Governor.”
Who really knows how Justice’s personal wealth is structured? As our Brad McElhinny reported two years ago, Justice’s myriad family businesses are a complex web that even the courts have had trouble sorting out.
It would be too easy to dismiss this most recent financial controversy as just another in a long line of financial disagreements that always seem to accompany the Justice family businesses. The size of this debt and the personal guarantees suggest a new level of financial peril for Justice.