David Stockman is under investigation for his role running Collins & Aikman, an autoparts company. You might recall the name Stockman. it became a household name when he was appointed budget director in the first Reagan administration. Before that he had been a member of Congress with a reputation for being allied with the tax-cutting supply siders.
Shortly after he started working on the Reagan budgets he voiced his complaints about the budget process built around cutting taxes while deficits mounted to a reporter named William Greider, and that conversation became an article titled "The Education of David Stockman." Despite the scandal of this article, which referred to the supply-siders tax-cuts as a "Trojan Horse," Stockman managed to stick it out in the administration for several more years. After leaving in 1986, he published a book claiming that the "Reagan revolution" had failed because Congress had refused to embrace spending cuts.
After leaving politics, Stockman spent the next dozen or so years running around the finance world, first at Salomon Brothers then at Blackstone. Eventually he left Blackstone to start his own private equity firm, Heartland Industrial Partners, L.P., which specialized in buying up companies in decidely unfashionalbe industries, especially the auto industry. A few years ago, Stockman installed himself as CEO of Collins & Aikman. And, apparently, that's where the trouble really started.
From the New York Sun:
Federal investigators and prosecutors are preparing a case against Mr. Stockman and other corporate officers from Collins & Aikman and expect to present the findings soon to a grand jury in New York City, the official said.
The investigation is focused on whether Mr. Stockman and other corporate officers at Collins & Aikman misled investors about the financial health of the company by artificially inflating stock prices. ABC News reported on the case Monday.
Reagan Official Is Investigated For Possible Fraud [New York Sun]