Article from: www.thenewspaper.com/news/42/4266.asp
11/22/2013Goldman Sachs Gives Its Own Traffic Camera Executive An Award
American Traffic Solutions CEO receives innovation award from largest shareholder of his company.
Investment bankers at Goldman Sachs are pleased with the performance of American Traffic Solutions (ATS), the red light camera and speed camera company that it has given the company an award. ATS has picked up business as its primary competitor, Redflex Traffic Systems of Australia, has been bogged down in the wake of multiple bribery investigations. Late last month, Goldman Sachs decided to promote ATS CEO James D. Tuton as one of the "100 most intriguing entrepreneurs of 2013" at the Goldman Sachs Builders and Innovators Summit.
"I am honored to have been included with this group of visionaries," Tuton said in his statement upon receiving the award. "The opportunity to be among America's next wave of the best and brightest innovators and share stories and ideas was an inspiring experience."
Left out of Tuton's own announcement was any disclosure that Goldman Sachs is the single largest shareholder in ATS. The investment bank bought a 30 percent stake in the photo ticketing firm in 2008 shortly after receiving $5.6 billion in federal taxpayer bailout funds. The buy entitled Goldman to seats on the ATS board of directors, and the cash infusion helped ATS buy out smaller rivals to further expand market share.
The second annual Goldman Sachs award event held at the Ritz-Carlton luxury resort outside Tucson, Arizona drew big name guests, including Hillary Clinton. The former secretary of state charges $200,000 to appear at such events to make a speech, but with a net income of $41 billion last year, Goldman could afford the high-dollar guests.
As a privately held company, ATS keeps its finances a secret, though it boasts revenue "in excess of $200 million." This is substantially more than Redflex, which reported just $137 million in revenue last year.
All is not well for ATS, however. Not long after the summit, however, Tuton lost a key ruling before the Missouri Court of Appeals that has caused a half-dozen cities to freeze their red light camera programs (view ruling). ATS had pushed municipalities in the state to rush red light cameras into service despite the lack of a statewide authorization law. Tuton's own attorney had warned him in 2005 that doing so was likely to be found illegal (view full letter). The potential for refunds in Missouri and Florida could cost ATS, and its largest shareholder Goldman Sachs, millions.