State: Some say probe tests ties to GOP backer

Some say probe tests ties to GOP backer

Observers speculate that the FBI inquiry into a business once run by J. David Eller has Republicans watching their step.

By ADAM C. SMITH

DEERFIELD BEACH -- J. David Eller, water pump manufacturer, weekly newspaper publisher, Baptist church owner, has long been helpful to powerful politicians.

During the past decade, the Deerfield Beach businessman has given hundreds of thousands of dollars to the Republican Party, and assorted state and national candidates. He has mingled with the nation's past three presidents and hired Jeb Bush for a job that would earn Florida's future governor nearly $650,000.

But now politicians might find friendships with Eller a tad awkward. The family-owned pump business that Eller turned into a multimillion-dollar, international company, MWI Corp., is under investigation by the FBI because of taxpayer-backed water pump deals in Nigeria.

Suddenly, a controversial business venture that Jeb Bush appeared to have put behind him in the 1998 governor's race is back in the news.

Just as the FBI investigation came to light late last month, presidential candidate George W. Bush and his brother Jeb were mixing and raising money with prominent Republicans throughout South Florida. Eller, a former Republican state committeeman and longtime friend of the Bush family, was not included among the listed hosts for the $1,000-a-plate Bush fundraiser in Fort Lauderdale, though Eller's 27-year-old son was.

"They don't want the slightest criticism," speculated Richard Lorraine, a Republican activist from Deerfield Beach. "They don't want Al Gore's people or Pat Buchanan or someone else they view as a loose cannon to say, "Look at this guy you've got working with you. He's under investigation by the FBI.' "

Gov. Jeb Bush has had no contact with Eller since his inauguration, said Cory Tilley, Bush's communication director. But Tilley said that's no indication of Bush distancing himself from his longtime friend and former business partner; rather, it's a reflection of busy schedules.

MWI, which stands for Moving Water Industries, in 1992 sold Nigeria $74.3-million-worth of giant water pumps and other equipment in a deal made possible by a loan from Export-Import Bank of the United States. Nigeria is about $23-million behind on its payments, and as the Miami Herald reported last year, many of the pumps were unaccounted for or sitting idle.

From 1989 to 1993, Bush and Eller co-owned a company, Bush-El, that marketed MWI pumps, which are used for flood control and irrigation. Bush traveled to Nigeria to help push the pump sales, and as son of the president, received red-carpet treatment.

Still, Bush repeatedly has said he made no money from the Nigerian deals because, with U.S. loans involved, he wanted to avoid any appearance of a conflict.

Bush has not been contacted by the FBI agents investigating MWI. Tilley said the administration officials were notified of the investigation by MWI general counsel William Bucknam "as a courtesy." Tilley stressed that no one has suggested wrongdoing by Bush. He said the governor would cooperate with the FBI if asked.

Former MWI pilot Greg Johnson, who was interviewed by the FBI, said it appeared the investigation focused on how the U.S. loan money was spent.

In an interview, Johnson contended that the pump prices were highly inflated and many of them could never be used because of infrastructure problems in Nigeria. "It was the biggest scam I've ever seen in my life," Johnson said.

"I think the investigation is about misappropriated funds. They (the U.S. government) financed a pig in a poke, and I think they're interested in knowing where the money went and who made the commissions. . . . The only scenario where I could see Jeb Bush involved is if they call him in and ask him where the value of his $648,000 comes from and what did he do for that money."

Bush reported making $648,000 from MWI, about $452,000 selling his stake in the company back to Eller in 1993 and the rest from sales commissions from countries other than Nigeria. He has not provided details about those other sales.

Nigeria has been MWI's key customer since the 1980s, thanks in large part to the Ex-Im bank. Before Bush joined Eller's team in 1989, MWI received nearly $90-million in Ex-Im backing for pump sales to Nigeria.

The country's problems paying back those loans prompted Ex-Im to tighten its loan policies for Nigeria. But by 1990, MWI was working on persuading Ex-Im officials to back more pumps sales to Nigeria. They approved eight separate loans to Nigeria totaling $74.3-million.

Jeb Bush has said he never spoke to anybody in the U.S. government about the the Ex-Im loans.

Former MWI pilot Johnson said he and other former staffers interviewed by the FBI have heard nothing more from the agents for at least three months. Greg Horner, an FBI spokesman in Washington, said the investigation is "ongoing" so the agency would have no comment on it.

Even some of Eller's most ardent critics said they hoped Bush was not swept into the FBI investigation.

"I hope he's not. I like Jeb very much," said Robert Purcell, a former MWI vice president who sued the company, alleging that commissions due to him were improperly diverted to Bush-El and other Eller-related companies.

Purcell settled the lawsuit in October under confidential terms and said he could not discuss anything about the company. He did say that he was not interviewed by the FBI.

Eller has officially retired as head of MWI and turned over the reigns to son Dana. He would not comment for this story. In a brief statement issued by MWI's public relation's firm, the company attributed the FBI investigation to news coverage of the Nigerian deal during last year's governor's race.

"In response to those stories, the federal government requested documents related to those allegations and requested to speak to some of our current and former employees," MWI said. "We are cooperating completely, and we understand the government's desire to follow up. We look forward to those allegations being proven false once and for all."

Ann Herberger, George W. Bush's Florida fundraising coordinator, said David Eller's absence from Bush's fundraiser simply occurred because he was out of town.

As recently as April, Eller donated $10,000 to the Republican National State Elections Committee, and in March he gave $1,000 to George W. Bush. Eller, a 57-year-old engineer who sometimes sports snakeskin boots, was 36 when he took the helm of the company founded by his grandfather in 1923.

It was David Eller who expanded the pump company's reach across the world -- especially to lucrative markets in sub-Sahara Africa. A company biography recounts Eller in the 1970s surveying African job sites from a canoe. He told the Sun-Sentinel in Fort Lauderdale he once attended a meeting that squelched a rebellion in an unnamed African country. Eller has been described as a born-again Christian, but his politics have been more pragmatic than dogmatic.

Last year, for instance, he sent $500 to U.S. Rep. Charles Rangel of New York, the senior Democrat on the House Ways and Means Committee, who pays close attention to international trade with Africa.

"There are different people who get up at (Republican) meetings who give speeches and are committed to certain causes. . . . But from what I've seen with David, it just seems like his involvement is purely for business purposes," said Broward Republican Lorraine.

David Eller's friendship with Jeb Bush dates back to the early 1980s. Under the Gov. Bob Martinez administration, Bush was secretary of commerce, while Eller was a member of the Lottery Commission. Bush at least once flew on an MWI plane for trade missions to Mexico.

Bush never has had anything but praise for Eller. But the deal itself, Bush has acknowledged, has been a political migraine.

"I made money. That's the only benefit I can see," he told the Times last year. "Otherwise, it's been unmitigated grief."