A federal grand jury in Jackson began hearing testimony last week concerning the oft-ballyhooed Magnolia Venture Capital Corp. debacle. Officials called to testify, including state representative and unofficial Republican gubernatorial candidate Charlie Williams of Senatobia and Mississippi Department of Economic and Community Development executive director Jimmy Heidel, claimed their appearances were routine and that they were there simply to provide background information on the formation of Magnolia Venture.
As routine as that testimony may have been, clearly, there is nothing routine about a federal grand jury investigation.
Intended as a spark for economic development, Magnolia Venture only provided support to one company. Millions were spent on administration, and critics allege, to support the high-rolling lifestyle of former Baptist deacon and Magnolia Venture head, Steve Caldwell.
At press time, it was not known whether or not Caldwell would testify in Jackson. Caldwell`s whereabouts were also unknown. His apparent disappearance has led many to speculate that the state does not stand a chance of recouping any misspent funds.
As rumors abound about “what really went on” at Magnolia Venture, we are confident that the federal grand jury will get to the bottom of this mess and issue appropriate indictments.
Whatever the outcome, officials should learn a lesson from Magnolia Venture: The state of Mississippi has an important role to play in economic development, but it should stay out of the risky venture capital game. That is an arena best served by private sources.
Legislators, business leaders and taxpayers must take an active role in voicing opposition to future state-subsidized, venture capital schemes.
We can`t afford another Magnolia Venture.