A Look at Scrutinized Deals at Rauner Equity Firm

Republican businessman Bruce Rauner's GTCR private equity firm created, bought and sold hundreds of businesses, establishing a reputation for success in the investment field. But he has been criticized by his opponent in the Illinois governor's race, Democratic Gov. Pat Quinn, for things that went wrong at some of those companies. Here's a look at five that have come under scrutiny, with Rauner's response:

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Trans Healthcare Inc.

Anti-Rauner ads claim that the company partially founded by GTCR drained money from nursing homes, causing residents to become malnourished and dehydrated while Rauner's company profited. Lawsuits filed on behalf of three residents who died led to more than $1 billion in judgments against Trans Healthcare that managed the facilities.

Rauner called the ads "an outrageous political attack." He said the company was in bankruptcy when the judgments were awarded and presented no defense. The verdicts are being appealed.

"My heart goes out to the families who were impacted by deaths in nursing homes, it's a tragedy," he said. "I believe anyone who made an inappropriate decision will be punished to the fullest extent of the law."

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American Habilitation Services

GTCR launched the for-profit company, which ran a chain of long-term care homes, in 1996. In lawsuits and state records, the company is accused of providing unsafe living conditions that led to fatalities. In one case, the state of Texas took over a care center after an 11-year-old resident died.

Rauner said he didn't sit on the board or manage day-to-day operations. He said the management team chosen by GTCR "let us down."

"That company failed. There's really no excuse for it," Rauner said.

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Lason Inc.

GTCR reportedly made at least $32 million by selling its stock in the Michigan-based imaging company Lason Inc. before an earnings scandal became public. Three top executives went to prison, according to the Chicago Tribune. Neither Rauner nor his partners were accused of wrongdoing.

Rauner was on Lason's board of directors but stepped down before his term was complete, and just months before the company acknowledged major losses that had been hidden by an accounting fraud. He has said he cooperated with the investigation when he learned about it.

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ConvergEx Global Markets

In August, the former CEO and a former trader at broker-dealer ConvergEx Global Markets were indicted in New Jersey on charges of securities fraud and conspiracy to commit fraud. Prosecutors said the scheme to conceal fees bilked millions of dollars from clients.

GTCR partnered with Bank of New York to form the company in 2006.

Rauner said he was never directly involved with the company and that the two under indictment should serve time if the allegations are true.

"This is a company separate from my company. Nobody reported to me. They were five layers away from me," Rauner said.

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APS Healthcare

GTCR was the majority owner of APS Healthcare when the company was accused of charging Medicaid in Georgia for services authorities said it didn't provide. The company agreed to pay a $13 million settlement, but didn't admit wrongdoing.

The Quinn campaign accused Rauner of "profiteering," saying he made money at the expense of vulnerable people who didn't get care they needed.

The Rauner campaign noted he never was on the board at APS, and said he had no role in putting the deal together or managing the company.