12 in a federal court in Washington reveal that government investigators pursuing possible fraud claims against Armstrong have also subpoenaed Weisel, founder of the Montgomery Securities investment bank and co-chairman of Stifel Financial.
In Silicon Valley, Weisel, 71, is renowned for having taken public such companies as and . In sports, though, he is known as the founder, owner, and chairman of San Francisco-based Tailwind Sports, the holding company for the U.S. Postal Service cycling team that Armstrong led to an unbroken string of seven victories in the Tour de France, from 1999 to 2005. From 1996 to 2004, the U.S. Postal Service paid out $40 million in federal funds to sponsor the team. Team management, which hired and paid the riders, promised in its contracts not to tolerate doping. The Major Fraud Investigations Division of the Postal Service’s Office of Inspector General is trying to determine if Armstrong and others defrauded the government by violating that no-doping clause, a federal prosecutor wrote in a filing last year. Weisel declined to comment for this story. He has not publicly addressed reports of doping on the team.
In addition to the Postal Service’s probe, two other legal cases have targeted Tailwind since October, when the U.S. Anti-Doping Agency (USADA) issued its devastating 1,000-page report portraying Armstrong as a serial cheat. Those cases also turn on whether Armstrong’s use of banned drugs constitutes financial fraud—and if so, whether the team’s owners can be held financially accountable.
In Texas, an insurance company wants to recoup $11 million it paid to Tailwind to cover multimillion-dollar performance bonuses triggered in Armstrong’s contract each time he won the Tour de France. “Tailwind is in our sights because Armstrong’s doping activities were concealed from us,” said Bob Hamman of Dallas-based SCA Promotions, a sports insurer. “More to the point, he’s no longer winner of the Tour de France.”
Of potentially greater impact is a whistle-blower lawsuit that records show was filed against Tailwind by former cycling star and confessed doper Floyd Landis. In an affidavit, Landis told the anti-doping agency last year that he was introduced to blood doping by U.S. Postal Service team officials “acting on behalf of Tailwind and its principals.” Landis’s suit seeks to recoup the $40 million in sponsorship fees paid to Tailwind by the Postal Service. If he succeeds, Landis and the government would share the award. The complaint is sealed under terms of the federal False Claims Act. (CBS News and the report that Armstrong and his agent Bill Stapleton may also be seeking to repay several millions of dollars to the Postal Service “as part of their cooperation in the case.”)
U.S. Justice Department lawyers, meanwhile, are weighing whether the government should join Landis’s lawsuit, court records indicate. By law, companies that submit false claims to the government can be fined triple damages—as much as $120 million in the Tailwind case.
Born in Minnesota, Weisel was a champion speed skater who narrowly missed making the 1960 U.S. Olympic team. He earned a bachelor’s degree at Stanford University and an MBA at Harvard and then launched a banking career in San Francisco. He developed a reputation as a Type A personality with sales acumen and an intense competitive streak. Weisel sought out and hired athletes, even some inexperienced in finance, who could help the company dominate local corporate track competitions.
Weisel pushed out his partners at the firm Robertson, Coleman, Siebel & Weisel in the late 1970s, taking over as chief executive officer. He changed the name of the firm to Montgomery Securities and became wealthy backing promising medical and technology companies. In 1997, he cashed out through a $1.3 billion sale to that he helped orchestrate, later hiring key executives to the newly formed Thomas Weisel Partners. He sold that firm in 2010 to Stifel Financial and became its co-chair.
For much of his business career, Weisel continued competing in sports. In 1982, at 41, he placed third in his age division at the U.S. national skiing championships. He took up cycling the next year. His training regimen, detailed in his biography, included weekly flights from his Marin County home to Southern California practice sessions with ex-U.S. Olympic cycling coach Eddie Borysewicz. In 1989, Weisel won two cycling world championship gold medals in his 45-and-over age division. By then, he had his eye on the Tour de France.