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Katrina Donation Ignites Debate: Neil Bush's investors

Posted in the database on Sunday, March 26th, 2006 @ 11:19:16 MST (4865 views)
by Jennifer Radcliffe    The Houston Chronicle  

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HISD says focus on Neil Bush's software didn't violate policy

As Barbara Bush spent two hours championing her son's software company at a Houston middle school Thursday morning, a watchdog group questioned whether the former first lady should be allowed to channel a donation to Neil Bush's Ignite Learning company through Houston's Hurricane Katrina relief fund.

"It's strange that the former first lady would want to do this. If her son's having a rough time of it, couldn't she write him a check?" said Daniel Borochoff, founder of the American Institute of Philanthropy, a Chicago-based charity watchdog group. "Maybe she isn't aware that people could frown upon this."

Some critics said donations to a tax-deductible charitable fund shouldn't benefit the Bush family. Others questioned whether the Houston Independent School District violated district policy by allowing the company to host a promotional event on campus.

HISD officials said the event at Fleming Middle School, where Bush met with 40 educators and business leaders, did not violate policy.

The school is among eight area campuses that received Ignite "Curriculum On Wheels" systems because of Bush's donation of an undisclosed amount to the Bush-Clinton Houston Hurricane Relief Fund.

She gave specific instructions that part of the money be sent to the Scottish Space School Foundation. She asked that group, in turn, to use the money to buy eight Ignite systems — valued at $3,800 each — for Harris County schools with large numbers of Hurricane Katrina evacuees, according to Bush and fund officials.

"I said to George one day: 'Maybe it's sort of selfish of me, but I'd like to give something that I could see the results of,' " she told the crowd. "The thing I knew about was the COW."

She said she hopes the donation will encourage other companies and individuals to give both time and money to public schools strapped by Hurricane Katrina.

Bush said her son's company could not have afforded the donation on its own.

"They gave a lot. They couldn't give more," she said. "They'd love to give more, but they're a little, small company."

Steve Maislin, president of the Greater Houston Community Foundation, which is administering the $979,000 relief fund that Bush donated to, said the donation was made legally and properly.

"Mrs. Bush wanted to support the local hurricane effort," he said. "She could have done it directly. She chose to do it through here to get the word out about the fund."

Fleming rolled out the red carpet for Bush. Colorguard members from Wheatley High School and band members from Kashmere High School performed. Three Hurricane Katrina evacuees who now attend Fleming spoke about why they enjoy using the Curriculum on Wheels.

"It makes me laugh," said Bryson Smith, a 15-year-old Fleming student. "I really do enjoy the COW."

While HISD has a policy that prevents the district and its schools from endorsing or promoting the "merit of a brand name or trademarked products," Houston officials defended the event.

"HISD employees talk about the value of instructional products all the time. Fleming Middle School thanked former first lady Barbara Bush for helping provide an instructional program that they found of benefit," deputy press secretary Adriana Villarreal said. "Students had the learning opportunity of confidently standing up at a podium, speaking articulately and explaining to former first lady Barbara Bush what they learned from the instructional program."

Nancy Lomax, a longtime parent activist in HISD, said the district shouldn't have allowed the event to be held during school hours.

"HISD as a matter of policy does not endorse products. I think they're getting way off course, their own moral course," she said. "I can understand that HISD is in an awkward position to accept a gift from a powerful person, but at the same time to turn it around and make it a dog and pony show is disgusting."

Ignite, which currently says it does businesses with 81 districts in 13 states, has been under scrutiny since its inception in 1999. Reports show that the company received funding from foreign oil sources, computer magnates and friends of the Republican family. The Austin-based company got its foot in the door in HISD in 2003, when Neil Bush and the HISD Foundation agreed to raise $115,000 in private donations to foot half of the bill for the software.

Susan Ohanian, a former public school teacher and Vermont-based author who tracks educational issues, said she was stunned by Bush's donation.

"The public has a very hard time understanding that some money is not worth it," she said. "I've never heard of anything like this so blatant: Pull at your heart strings with Katrina victims and then make sure your son profits from it."

An HISD-funded external evaluation of Ignite Learning in 2004 found that teachers gave an older version of the product generally positive marks.

"Teachers also found it to be effective in improving student understanding of history, engaging students in the learning process, and to a lesser degree, helping students pass the (Texas Assessment of Knowledge and Skills)," the study said.

It's currently used on 15 HISD campuses, officials said.

Teachers raved about the software Thursday. The purple machine displays science and history lessons to the class through a projector. They touted its graphics and music.

"It enhances learning. It excites the children," said Kathie Guillory, chairwoman of Fleming's science department. "They grasp more, and they retain it longer."

Officials at Fleming and other area schools said they plan to buy more COW units.

"I'm doing everything I can to get them in every class in our district," said Brett Schiewer, a science specialist in the Katy school district.

Schiewer said he understands some of the concerns about the donation.

"That was one of my thoughts, but, truly a quality product speaks for itself," he said. "It still benefits kids, which is why we are here."


Neil Bush's Investors

By Paul Kiel

Yesterday, Josh pointed out that the business model for Neil Bush's education company Ignite! seems to be that "Neil goes around the world finding international statesmen, bigwigs and criminals who want to 'invest' in Ignite! as a way to curry favor with the brother in the White House."

But just who are those statesmen, bigwigs and criminals?

The company declines to name private investors, but documents filed with the SEC show that it raised $7.1 million from 53 investors. There are a number of unnamed investors from the UAE, Saudi Arabia, and the British Virgin Islands.

Here are the ones we do know about. It's quite an international grab bag:

-- Hamza El Khouli, an associate of Egyptian President Hosni Mubarak and chairman of First Arabian Development and Investment Company (Lawrence Journal World)

-- Les and Anne Csorba, Bush contributors who worked in the first Bush White House in the White House Personnel Office and the Office of Personnel Management (Houston Chronicle).

-- Former Iranian Ambassador Hushang Ansary, a Houston businessman (Houston Chronicle).

-- Sofidiv Inc., a division of the Moet Hennessy Louis Vuitton luxury goods company (Houston Chronicle)

-- Mohammed Al Saddah of the Ultra Horizon Co. in Kuwait (Houston Chronicle).

-- Winston Wong (alternately, Winston Wang), a Taiwan businessman who started the Grace Semiconductor Manufacturing Corp. with the eldest son of China's president, Jiang Zemin (Washington Post)

-- Joseph Peacock, company secretary at Crest Investment, where Neil Bush was co-chairman; they specialize in the energy sector. Peacock is also involved with many companies owned by Jamal Daniel - Daniel is a Syrian-American businessman with business ties to the Bush family (St. Petersburg Times)

-- Boris Berezovky, a Russian billionaire living in London with ties to many Russian politicians, including Boris Yeltsin. He is sought by Russian prosecutors and Interpol for fraud (Moscow Times, Washington Post)

-- Knowledge Universe, a company chaired by former junk bond king Michael Milken (Philadelphia Inquirer, AP)

-- The Nagase Brothers education company in Japan (AP, NY Times)

-- Timothy Bridgewater, the chief executive of Interlink Management, the venture capital firm he and Neil started, also one of the Republican “Pioneers” who helped raise $100,000 for George W. Bush during the 2000 campaign (Philadelphia Inquirer)

and finally,

-- Bush's parents

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