Birmingham, Ala., Mayor Questioned on Bond Underwriting Fees

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Birmingham, Ala., Mayor Larry Langford will not say why he refused to answer questions from the U.S. Securities and Exchange Commission, but says he believes he is the target of a federal criminal investigation.

“I’d be a liar if I said no,” Langford said Tuesday when asked if he thought he was being investigated by federal authorities. “But the fact of the matter is, I’m not scared.”

The SEC is trying to compel Langford to testify as part of an investigation into bond swap transactions when he was a Jefferson County commissioner.

When asked why he refused to answer questions when he appeared in Miami last week in response to a subpoena, Langford would only say that he had already gone to Miami earlier in the year to answer the SEC’s questions. He said he made that trip against the advice of his attorneys.

“I answered the questions truthfully, and I did not need to cite the Fifth Amendment,” Langford said. “From now on, I’ll listen to my lawyers and let them handle it.”

Langford and Montgomery investment banker Bill Blount “both declined to testify or articulate a recognized legal privilege that would excuse them from answering the staff’s questions” during their appearances last week, according to an SEC news release. Blount’s firm received several million dollars in underwriting fees from the bond transactions.

Langford said he was disappointed that the SEC released “supposedly confidential” information to the public.

The SEC said in a document filed with the U.S. District Court in Florida that its staff is investigating whether anyone, including Langford, Blount or others, violated federal securities law relating to Jefferson County’s bonds or security-based swap agreements.

In June, federal officials questioned Langford about his financial dealings with Blount as well as with lobbyist Al LaPierre, who paid off two bank loans totaling $125,000 for Langford in 2003.

Langford said Tuesday that the $125,000 was just a loan, and he signed a note on it as if it were an official bank loan.

Information from: The Birmingham News