Georgia Ad Watch: Democrats slam Kemp over $500k loan

September 19, 2018 Bowersville - Exterior of the Hart AgStrong facility in Bowersville on Wednesday, September 19, 2018. HYOSUB SHIN / HSHIN@AJC.COM

September 19, 2018 Bowersville - Exterior of the Hart AgStrong facility in Bowersville on Wednesday, September 19, 2018. HYOSUB SHIN / HSHIN@AJC.COM

A new ad from state Democrats says a lawsuit over a $500,000 loan supports their claim that Republican gubernatorial candidate Brian Kemp “can’t be trusted.”

The Democratic Party of Georgia is paying for the ad, which began airing early Saturday morning in the Atlanta television market for Stacey AbramsKemp's rival in the general election.

The plot

The ad opens with television footage from a courtroom. A man standing in front of the bench, identified in media reports as attorney Patrick O’Brien, declares: “Show me the money. Where’s the $500,000?”

The ad continues with excerpts from various news reports about a lawsuit against Kemp, Georgia’s secretary of state, and others over a $500,000 loan that went into default.

“Secretary of State Brian Kemp cheated his investors,” one Atlanta television report says.

The ad concludes with a photo of Kemp and the narrator declaring: “Brian Kemp can’t be trusted.”

The context

The claim in this ad is not new. It was raised by Lt. Gov. Casey Cagle in the GOP runoff before he was trounced by Kemp.

Kemp is a defendant in a lawsuit filed in Gwinnett Superior Court over a loan he guaranteed for Hart AgStrong, an agricultural business in which he invested.

Kemp’s lawyers have disputed the validity of his commitment to back the $500,000 loan to AgStrong. Campaign aides also have said other investors also guaranteed loans to AgStrong, a canola processor based in Bowersville, about 100 miles northeast of downtown Atlanta.

"Brian Kemp is one of many investors in Hart AgStrong, Cody Hall, Kemp's campaign's press secretary, said recently. "The company's collateral and equity exceed his investment."

Kemp has campaigned for governor as much on his private business background as his record in public office, including his current service as Georgia Secretary of State. A court case involving a delinquent loan could undermine his attacks on Abrams for debts that include more than $50,000 in back taxes.

The lawsuit that’s the focus of the ad was filed by Toccoa businessman Rick Phillips, who says he lent AgStrong money in 2015 and 2016 at Kemp’s request. Records show Kemp played a central role through much of AgStrong’s 10-year history, signing real estate and loan documents that identified him, at various times, as its assistant manager and corporate secretary. They also show Kemp personally negotiated the $500,000 loan now at the heart of litigation, as well as an earlier $600,000 loan from the same lender, Phillips’ firm RLP Investments.

AgStrong paid off the first, $600,000 loan in about a month, as promised. The second loan, for $500,000, was due in October 2016, The Atlanta Journal-Constitution has reported.

The response

Ryan Mahoney, a Kemp spokesman, called the ad “another failed attempt by radical Stacey Abrams to cover up her tax scandals and extreme agenda.”

He blasted Abrams for deferring more than $50,000 in federal tax payments while loaning her campaign for governor roughly the same amount.

“With a record like that,” Mahoney said, “it’s no wonder she resorts to false, recycled attacks.”

Watch the ad

More about Kemp and AgStrong

"Why a Kentucky town is in the spotlight in Georgia's governor's race

"For Brian Kemp, suit over bad loans reveals political, financial perils"

See other ads in Abrams-Kemp race.