Will French banking scandal hit Idaho resort?Feb 6th, 2008 | By Jody May-Chang | Category: Uncategorized
Local residents in Valley County are all abuzz about a billion dollar banking scandal in France that could have a direct impact on Tamarack Resort located near Cascade, Idaho.
The local weekly newspaper, The Long Valley Advocate, is reporting in its Feb. 6 edition (left) that the $7 billion banking fraud by a rogue trader at Societe Generale (SoGen) in Paris could have a direct impact on the resort’s finances.
Jerome Kerviel, 31, admitted to making mistakes but told investigators that SocgGen knew and approved of his apparent unauthorized activity and that other traders had engaged in similar practices.
Recent reports put the French bank at suffering $10 billion of losses, the combination of a mind-boggling $7 billion fraud on the part of a single stock-index trader in Paris and $3 billion in subprime exposure.
A PrideDEPOT.com source in Valley County who requested anonymity, described SoGen as Tamarack’s primary financial backer.
“Due to their monetary loss, they (SoGen) will no longer be providing financing to Tamarack,” the county government source said.
Meanwhile, the Long Valley Advocate reports that resort officials will not, “elaborate on layoffs of resort employees” that have reportedly been taking place over the last week and a half.
Reporter Mike Stewart wrote that Tamarack CEO Jean-Pierre Beospflug gave his newspaper a prepared statement by way of email saying that, “Tamarack finances our construction with large credit facilities, representing multi-million-dollar loans, used to pay the cost of construction needed to deliver projects such as Village Plaza.”
Beospflug’s statement also states that Tamarack “Ã¢â€šÂ¬Ã‚Â¦has been working diligently over the last several months to secure our next credit facility needed to continue our real estate development and construction projects.”
Meanwhile, the resort was recently fined $185,000 for violation of the Clean Water Act in connection with stormwater runoff between 2005-2006.
In late January, Tamarack asked the state to guarantee a $42.5 million low-interest loan for expansion of sewer and drinking water systems to serve the resort community. The Associated Press reported that, Tamarack pledged $728 million worth of property as security.
In lieu of state tax money, the North Lake Recreational Sewer and Water District has been offered the property as security instead.
The Long Valley Advocate, which does not a website, reported in its print edition that Tamarack officials will refrain from “saying much else regarding the issue at this time.”
Jody May-Chang now writes on "As I See It...Reporting from the front lines