Zach Lahn Won’t Answer for Running Mate’s Shady Loan As New LLC Raises More Questions

Zach Lahn Won’t Answer for Running Mate’s Shady Loan As New LLC Raises More Questions

New reporting from the Des Moines Register exposes Zach Lahn for refusing to reveal the mystery LLC that is paying off his running mate’s debt.

According to the Register, three weeks after joining the ticket with Lahn, “Wulf received a $540,000 loan” from University Relocation LLC – an LLC a well-connected Iowa attorney and contributor to Lahn formed “specifically to issue a loan to Wulf.” A former member of the state ethics board noted that the LLC being set up out of state was “significant”, making any attempts to investigate the entity “very hard.”

This isn’t the first time Lahn and his running mate have come under fire. Earlier this year, Wulf was accused of fraud and theft and of having ripped off local farmers and small businesses in Iowa.

Tellingly, Wulf and Lahn refused to comment on the Register’s story, hiding the truth from Iowans about who is loaning money to Wulf, and why they decided to help shortly after Wulf joined Lahn’s campaign.

Des Moines Register: Lender a mystery for $540,000 loan to GOP lt. gov. candidate Derek Wulf

• A week-old limited liability company gave Republican lieutenant governor candidate Derek Wulf a private loan this summer, raising questions about who assisted the politician in the months before November’s pivotal election.
• Wulf received a $540,000 loan from the newly formed University Relocation LLC of Moline, Illinois, in July, according to a mortgage securing the loan. The loan to Wulf came three weeks after Republican gubernatorial candidate Zach Lahn tapped Wulf as his running mate.
• As those cases proceeded, according to filings with the Illinois Secretary of State’s Office, an attorney formed University Relocation in Moline on June 26 on behalf of an unknown lender. The attorney, Richard Davidson of Davenport, told the Des Moines Register in late September that the lender does not want to be identified but offered the loan to Wulf at “market rate.”
• Erika Eckley, executive director of the Iowa Ethics and Campaign Disclosure Board, told the Register that her agency could not determine whether such a loan would violate state laws without knowing who the lender is.

• Wulf and a spokesperson for Lahn’s campaign did not return requests for comment
• Wulf, a farmer and state representative from Hudson, was deeply indebted when Lahn chose him as his running mate on June 12.
• Two weeks after Lahn named Wulf as the Republican Party’s lieutenant governor candidate, Davidson formed University Relocation, according to Illinois secretary of state filings. A week later, on July 2, the new company and Wulf signed a promissory note tied to a one-year, $540,000 loan.
• While WCF did not state the size of Wulf’s debt in its petition, exhibits filed as part of the lawsuit indicate Wulf owed about $3.1 million for lines of credit as of early May, with about $1,100 more in interest accruing every day. A judge granted WCF’s petition to appoint a receiver to take over Wulf’s home and farm on Sept. 1.

• WCF officials also filed a report of potential fraudulent activity against Wulf with the Black Hawk County Sheriff’s Office in February over how he allegedly disposed of livestock.

• In a January letter to Wulf’s father-in-law, former Iowa Cattlemen’s Association President David Petty, a WCF attorney alleged that Wulf was selling cattle in Petty’s name. WCF has a security interest in Wulf’s livestock, and the bank’s attorney wrote that selling the animals under Petty’s name would be tantamount to theft.

• Petty denied the allegation to the Register in August. He said at the time that he had not received the letter from WCF’s attorney, despite the bank filing a document in court that confirmed delivery of the letter to Petty’s home.
• According to a farm receiver’s report filed in Black Hawk County on Oct. 2, Petty and Wulf keep their cattle together on Petty’s pastures and neither has marked who owns which livestock.

• Davidson, the attorney who formed University Relocation, is a prominent attorney in Davenport.

• A lawyer for Lane & Waterman since 1985, he has represented the Davenport city government, the Davenport Community School District, the Diocese of Davenport and several local developers. He also represented Republican U.S. Rep. Mariannette Miller-Meeks during a high-profile recount following the 2020 election, which she won by six votes.

• Davidson has been a modest political donor, giving about $7,900 to state and federal campaigns and political action committees since 2005. The majority of his donations have gone to Republican candidates, including $100 to Lahn’s campaign committee on June 30.
• In an interview with the Register, Davidson said he formed University Relocation in June on behalf of “a single, Iowa-based private lender.” Later, he said a family owned the limited liability company and frequently extends private loans.

• He added that the lender does not “generally” want to be known and set up the business in Illinois specifically to issue a loan to Wulf.

• Asked why the Iowa company wanted him to form the business in Illinois, Davidson said, “They just felt it was to their advantage to structure it as they did.”
• Davidson also formed a University Relocation LLC in Iowa in 2009. That business remains active, according to filings with the Iowa Secretary of State.
• Davidson said Wulf’s lender is also behind the Iowa entity. But later, he added that there might be additional managers of the Iowa company who are not involved in the new, Illinois company.
• Iowa laws do not allow statewide political candidates to accept loans from lobbyists unless those lobbyists loan money as part of their normal business. The terms of the loan, such as the interest rate, would also need to be in line with what the lobbyist normally offers.

• Asked whether the lender behind University Relocation is a lobbyist, Davidson said, “I don’t have the faintest idea.”
• Depending on the terms of the loan, the ethics board could also view the transaction as a gift. If so, the board can investigate whether the money came from a “restricted donor,” which could include a government contractor or someone with an active case before a state regulator.

• Asked whether Wulf’s lender does business with the state, Davidson said, “not to my knowledge.”

• Zach Goodrich, a former executive director of the state ethics board, told the Register that violations of campaign contribution laws could result in fines of up to $2,000 per violation.
• The fact that Davidson registered a new company in Illinois instead of sending the loan through the Iowa company is significant, Goodrich added. While the board can issue subpoenas for records from Iowa-based companies, he said, the agency would need a judge’s approval before demanding records from a business in another state.

• “Without a subpoena, (investigating) would be very hard,” Goodrich said. “You could always hope for cooperation, but you obviously don’t want to rely on that too much.”

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