Patrick backs Ameriquest owner for ambassador's post

Democratic gubernatorial candidate Deval Patrick is urging the US Senate to approve a controversial ambassadorial nominee whose mortgage firm's lending practices are under investigation in 30 states and whose wife helped finance a GOP television ad blitz that targeted John F. Kerry in last year's presidential campaign.

Patrick last month wrote the Senate Foreign Relations Committee praising Roland Arnall, the principal owner of Ameriquest Capital Corp., whom President Bush has nominated to be US ambassador to the Netherlands. Patrick lauded the Los Angeles businessman's ''rectitude" and said that Arnall has demonstrated leadership and creativity in moving to correct his company's practices.

''This is a good man," Patrick wrote in an Oct. 19 letter addressed to Senator Richard Lugar, an Indiana Republican who chairs the committee, and to the ranking minority member, Senator Joseph Biden, a Delaware Democrat.

But his support for Arnall puts Patrick at odds with fellow Democrats and Kerry supporters, just as Patrick is trying to get traction in his campaign for the Democratic nomination for governor. The Democratic National Committee in Washington opposes the Arnall nomination, calling it an example of ''corruption and cronyism" in the Bush administration. Kerry also opposed the nomination.

Patrick said this week he did not consider the political repercussions when he responded to a request from Arnall to write the letter.

''My support for this guy was not a political calculation," he said in an interview. ''My support was based on his friendship and his character. If it was based on his politics, I would not have written that letter."

Arnall put Patrick, a former top US civil rights enforcer, on the Ameriquest board of directors in August 2004, to help resolve a wide-ranging investigation by regulators and attorneys general across the country. The privately held firm has over the years been forced to defend itself against allegations that it uses predatory lending practices directed at low-income minorities and the elderly.

Arnall, who Forbes magazine estimates is worth $3 billion, and his wife, Dawn, are listed as the leading donors to Bush and Republican campaign causes. They cochaired Bush's second inaugural committee. Ameriquest and its subsidiaries donated $1 million to the committee.

A Washington Post report in January said the Arnalls are ''the single biggest source of financial support for Bush since 2002. Over the period, they gave and raised at least $12.25 million." They also have donated to some Democrats.

Dawn Arnall donated $5 million in August 2004 to an independent political committee that spent $35 million undercutting Kerry's candidacy.

One ad showed Kerry windsurfing back and forth in Nantucket to the ''Blue Danube Waltz" while the announcer chided the Democratic presidential nominee for taking positions ''whichever way the wind blows."

The company said the Arnalls would not comment for this article.

Patrick, who worked closely with the Kerry campaign on potential Election Day voter fraud issues, told the senators that the Arnalls' well-publicized support of Bush should not be a factor as they vote on his nomination.

''Roland is a committed political independent who happens to believe that a Bush presidency is good for Israel, a principal focus of his concerns and interests," Patrick wrote. ''That is not a view I share but I respect that Roland holds it sincerely."

Arnall, 66, was born in Nazi-occupied France, but survived by hiding his Jewish identity. He immigrated first to Canada and then to California, where he has made his fortune in mortgage lending. Defenders of the Arnalls include two Democratic governors, Pennsylvania's Edward G. Rendell, and New Mexico's Bill Richardson.

His backers say the Arnalls have contributed millions to social and cultural causes and that their business has helped Americans who have few other financing options to purchase homes.

The company now says that it is in settlement talks with a 30-state coalition that includes Massachusetts and has set aside $325 million toward a resolution of mortgage lending accusations. But the lack of a final accord has slowed the nomination.

As the chief of the US Department of Justice's Civil Rights Division under President Bill Clinton, Patrick persuaded Ameriquest to enter into a $4 million settlement with the Justice Department after the company faced charges that it and its affiliates engaged in discriminatory pricing practices. It denied the allegations.

Four years later, Ameriquest faced accusations from ACORN, a national advocacy group representing low-income borrowers, that it preyed on minorities and other vulnerable borrowers.

Ameriquest denied the allegations, and later settled the matter when it agreed to a list of new principles in its lending practices.

Patrick said that as a board member his primary focus is to help Ameriquest improve its lending practices.

He has argued that he believes strongly that he can play effective roles in joining corporations -- he has served at both Texaco and Coca-Cola Corp. -- that are facing allegations that involve social and political issues, and helping them to correct the problems.

''I always say the measure of a good company is not whether things always go well, but whether a company does the right thing when they don't," he said in letter to Lugar and Biden. ''By that measure, ACC Capital and Ameriquest are good companies."