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Thursday, August 17, 2017

Massachusetts Democratic Party Questions Governor Baker’s Pick for MBTA General Manager

Massachusetts Democratic Party Questions Governor Baker’s Pick for MBTA General Manager: No Transit Experience and a Failed Business Record
BOSTON – The Massachusetts Democratic Party today issued the following statement regarding a report that newly appointed MBTA General Manager Luis Ramirez’s former company is under SEC investigation for financial misstatements during his tenure as CEO:
"When Governor Baker appointed a new MBTA General Manager with zero transit experience, he promised us that his pick had 'turnaround experience.' Now we've learned that his supposed turnaround of Global Power Equipment Group was really a $47 million loss, and the company is under SEC investigation for misstating its income when he was CEO,” said Massachusetts Democratic Party Chair Gus Bickford. “If Baker's MBTA General Manager doesn't know how to run a public transportation system or how to turn around a struggling company, what was he hired to do? What is Governor Baker's plan for the T?”
“The MBTA isn’t a private corporation for Charlie Baker’s big business allies to squeeze more money out of; it’s the engine that keeps the Greater Boston economy running,” continued Bickford. “When is Governor Baker going to admit that the T needs a long term plan and new investments, not just budget cuts and accounting gimmicks?”

Background:
Newly appointed MBTA General Manager Luis Ramirez was CEO of a company named Global Power Equipment Group from July 2012 until March 20, 2015. Yesterday, WBUR reported that two months after Ramirez departed, the firm had to notify the SEC that its financial statements for 2014 "should not be relied upon because of accounting errors." When the company refiled its financial statements, they revealed additional accounting errors for the three years Ramirez was CEO.
“In its original filing, Global Power Equipment Group reported a net income of $11 million for 2014, the final complete business year Ramirez served as CEO,” WBUR reported. “The company's restated SEC filings show that in 2014, it actually had a net loss of $47 million. Global Power Equipment Group originally overstated its 2014 net income by 524 percent.”
The SEC is now investigating Global Power Equipment Group, and a group of investors is suing Ramirez and the company.
Governor Baker cited Ramirez’s “turnaround experience” when announcing his hiring, and “transit expert was not high on our priority list” for a new General Manager, according to Transportation Secretary Stephanie Pollack.

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