To right a wrong

As of this writing, the trial of Raul P. Masvidal, the vaunted real estate developer turned alleged taxpayer swindler, was scheduled to begin this month. Since his arrest in March 2007, state attorneys have been preparing to prosecute him for fraud and grand theft on charges ofillicitly using some of the $5 million in taxpayer money he received as a loan from the Miami-Dade County Housing Agency. While much of that money may be lost forever, I’ve stumbled upon a way to recoup some of the funds. It won’t require a conviction or Masvidal’s approval should he elude a guilty verdict, just the cooperation of about two dozen honorable members of the U.S. Congress, from Florida and across the country.

Recently I have spent way too much time perusing the Federal Elections Commission’s excellent website, seeing which politicians some of Greater Miami’s rich and powerful have been voting for with their checkbooks. It’s always exciting when a candidate has to return a contribution from a highly successful businessperson who fell from grace owing to some indictment or other.

Even more thrilling is when the money that disgraced businessperson used for his generous donations was actually someone else’s, such as taxpayers. Of course, investing other people’s money to make a lot of money for oneself is what the smartest businesspersons do. Doing so is a tenet of modern-day entrepreneurship. And if one can turn a good deed while turning a big profit with other people’s loot, then it’s a beautiful thing.

Which is why Masvidal and two other wealthy developers—Oscar Rivero and Reynaldo Diaz—are in such fabulous trouble. Because using other people’s money to build affordable housing for the poor, or an office complex at a Metrorail station, is not so beautiful when you don’t actually build them and then spend the money on yourself.

The origin of Oscar Rivero’s legal woes was a check for $806,000 that he received from the Miami-Dade County housing agency in November 2004. He was supposed to use it to construct Las Rosas, an affordable apartment complex in Little Havana. Instead he spent $711,000 of it to buy a huge house for himself in South Miami.

By my calculation, that would leave about $95,000 in taxpayer money to play with. A new luxury automobile? Trips to Aspen or Cabo San Lucas? Dinners at Nobu or Ruth’s Chris Steak House? How about a prestigious donation to a charity or politician?

Prior to November 2004, Oscar Rivero had been a fairly generous donor to some of his favorite local politicians. Between 2001 and 2003, for example, he gave $1,000 to Miami’s U.S. Rep. Lincoln Diaz-Balart (R-FL), $3,000 to his brother, Rep. Mario Diaz-Balart (R-FL), $2,000 to former Sen. Bob Graham’s fleeting presidential exploration, and $2,000 to Alex Penelas’ unsuccessful 2003 U.S. Senate campaign.

Elected officials and their aides who are reading this can breathe a sigh of relief here. Rivero spent some of that taxpayer money on a new swimming pool for himself, but made no federal campaign contributions after receiving his $806,000 county check, according to the FEC database. So, no urgent need for politicians to return any donations from Rivero, though he could use them to reimburse the county, as he promised in his recent plea bargain, which recently earned him a 21-month prison sentence.

Nor is there a need to return any contributions from Reynaldo Diaz, who only dabbled in political donations anyway. He gave $500 to Mario Diaz-Balart in 2002 and $2,000 to Graham in 2003, but that was before Diaz received his check for $940,000 in taxpayer money from the county housing agency. Prosecutors allege Diaz used fraudulent documents to obtain the loan. His company, First Colonial Title Services, was title agent for Rivero when he used taxpayer dollars to buy that South Miami house. Diaz has pled not guilty and his trial was also scheduled to begin this month when this issue went to press.

In contrast, Raul P. Masvidal made a ridiculous number of federal campaign contributions after receiving his questionable $5-million loan from the county housing agency. County commissioners approved the payment to help Masvidal finance the construction of Hometown Station, an office complex at a South Miami Metrorail station in July 2003. Over the next two years, county investigators say they caught Masvidal using about $300,000 of that money to buy two giant sculptures. One, resembling a slice of watermelon, ended up at his spread off Old Cutler Road in southeastern Coral Gables.

Additionally, county auditors charge he used $355,000 of that taxpayer money to pay down a mortgage on that same home. Hometown Station, fraught with budget overruns and delays, never materialized. Masvidal has pled not guilty. County manager George Burgess has demanded that Masvidal return the $5 million.

Somehow, despite the fiscal implosions at work and home, Masvidal managed to find about $70,000 between 2003 and 2007 for some of his preferred politicos. Masvidal donated $3,000 to Penelas’s 2003 senate bid; his wife, Mercedes Masvidal, kicked in another $2,000. The couple also dropped another $1,000 each on Bob Graham’s presidential account.

Masvidal was especially generous to the Diaz-Balarts. He had given $1,000 to Mario Diaz-Balart in May 2002; after receiving the county loan Masvidal upped Mario’s gift to $2,000 in December 2003. Between 2003 and 2007 he gave $6,000 to the Diaz-Balarts’ Democracy Believers Political Action Committee, and $15,000 to another group they are involved with, the U.S. Cuba Democracy PAC, which funds members of Congress who vote to maintain or tighten the embargo on trade with, and travel to, Cuba.

During that time Masvidal also gave $2,000 to U.S. Republican Sen. Mel Martinez of Florida, $1,000 to U.S. Rep. Ander Crenshaw, a Jacksonville-area Republican, and $2,000 to Rep. Ileana Ros-Lehtinen (R-Miami) via her IRL PAC in 2005. He also spent $500 on Michael Fitzpatrick, who served one term as a congressman for Pennsylvania.

That was only the half of it. Masvidal’s munificence has been curiously bipartisan. Besides the $6,000 he and his wife gave to Miami area Democrats Penelas and Graham, in 2004 he sent $2,500 to the Democratic National Committee and $2,000 to the Campaign for Florida’s Future, which promotes fair elections and ethics in government.

Then in 2005 and 2006 the uncannily magnanimous developer gave $4,000 to Rep. Debbie Wasserman Schultz, a South Broward Democrat. During that period he also gave $7,200 to Florida’s Democratic U.S. Senator, Bill Nelson. (Previously, Masvidal had contributed $2,000 to Nelson’s first U.S. senate campaign in 1999).

Were Masvidal smarter about using other people’s money, he could have funneled these $70,000 in campaign contributions into a year of mortgage payments on his $1.8 million dollar home. But what if the county manager got in touch with all these public servants and they agreed to return those donations? It’s nowhere near the $5 million Masvidal is charged with owing us taxpayers, but it would be a start.