U.S. Rep. David Rivera won't face criminal charges in state investigation, sources tell Miami Herald

Article Courtesy of The Miami Herald

By Scott Hiaasen and Patricia Mazzei

Published April 20, 2012

U.S. Rep. David Rivera will not face criminal charges following an 18-month investigation of his personal and campaign finances by the Miami-Dade State Attorney's Office and the Florida Department of Law Enforcement, according to sources close to the probe.

   
Although records released late Monday show FDLE last year suspected Rivera of 'possible criminal and ethical violations,' ranging from campaign fraud to falsifying financial disclosure forms, prosecutors have concluded that they cannot charge the Miami congressman with any crimes because of ambiguities in the state's campaign finance laws and a shortened statute of limitations that barred prosecution for expenses more than two years old.
   

letter and spirit of Florida and federal campaign finance laws and has timely and properly reported all personal income." It later added that FDLE was provided with information refuting "all of their false and unfounded allegations against Congressman Rivera."

   
"In essence, FDLE launched a fishing expedition that became a wild goose chase and which has now proven to be a discredited, unwarranted and politically-motivated witch-hunt resulting in Congressman Rivera's exoneration," the statement said. "FDLE's unprofessional waste of taxpayer dollars in this matter is shameful."

    
The end of the investigation would lift a cloud that has hung over the first-term congressman since he was elected to the U.S. House in 2010 after serving eight years in the Florida Legislature. Rivera has struggled to raise money for his re-election campaign next November. 

   
But Rivera is not entirely in the clear: He still remains under investigation by the FBI and the IRS over a $510,000 payment from a dog track to a company managed by Rivera's mother and godmother.

   
The state probe focused on a series of campaign accounts managed by Rivera during his years in the Florida House of Representatives. 

   
Investigators found that Rivera had at least three campaign accounts used for both his state house campaigns and for his campaigns as a state committeeman from Miami-Dade County, an obscure post within the Republican Party. 

   
Rivera, once the powerful budget chief in the statehouse, received hundreds of thousands of dollars for his GOP committeeman campaign, including a $50,000 check from a firefighters' political action committee, sources said. But prosecutors concluded that these donations were not illegal: A little-known provision in state law allows candidates for party posts to raise unlimited amounts of money without disclosure.

  
Investigators also pored over Rivera's spending from the campaign accounts. In a July 2011 memo, FDLE investigators said they believed that Rivera spent as much as $65,000 in campaign funds on personal expenses -- from pet care costs to dry cleaning, a dentist's bill and "travel expenses for his girlfriend." The memo does not name the girlfriend. 

"After a thorough analysis, FDLE identified a pattern of activity in which Mr. Rivera was utilizing funds collected during his political campaigns to defray personal expenses not related to campaign activity," the memo says.

  
But prosecutors ultimately concluded that they could not prove that the money went to personal -- not political -- purposes. Rivera told investigators that he traveled constantly for political fundraisers and other events, making all of these expenses legitimate campaign costs, sources said.

   
Sources said Rivera met with prosecutors and investigators at least twice during the probe --  though Rivera denied having information about the investigation in an interview with Univisión last month.

  
Agents and auditors also reviewed hundreds of thousands of dollars in campaign expenses Rivera paid to political consultant Esther Nuhfer, a close Rivera ally, and payments to companies managed by his mother, and the daughter of Rivera's top legislative aide. But investigators found no evidence that Rivera personally benefited from these payments. 

 
Investigators examined Rivera's campaign expenses going as far back as 2004. However, a two-year statute of limitations on campaign violations prevented prosecutors from pursuing a case based on any suspected violations prior to Rivera’s 2010 campaign, the sources said.

 
The state attorney’s office also investigated the $510,000 payment from the Flagler Dog Track --  renamed the Magic City Casino -- that is now the focus of the IRS investigation.

  
In 2006, while serving as a state lawmaker, Rivera agreed to work as a consultant for the dog track in its push to win approval from Miami-Dade voters for casino-style gambling at parimutuel venues. The track owners ultimately agreed to pay $1 million to Rivera, investigators found.

  
But Rivera asked the track to pay the money not to himself but to Millennium Marketing, a company created by Rivera's godmother, investigators say. Of the $1 million contract, $300,000 remained unpaid as of July, according to the FDLE memo.

  
Investigators traced at least $150,000 of that money from Millennium back to Rivera -- money that Rivera never mentioned in his state financial disclosure forms. 

  
Rivera later said he received $137,000 in loans from Millennium. When questioned about the arrangement, Rivera's mother and godmother gave investigators copies of promissory notes verifying the loans. In the memo, FDLE investigators said the notes "appear to have been created by Millennium Marketing, Inc. to further the concealment of funds to Mr. Rivera."

  
FDLE investigators said they could find no evidence that Rivera's contract with the dog track influenced his votes in the Legislature. "But he did take steps to disguise his relationship with a special interest group," the FDLE memo says.

Prosecutors determined that the payments from the dog track were not improper because Rivera performed the work under the contract. 

OFFICE OF EXECUTIVE INVESTIGATIONS

David Rivera: Allegations of Official Misconduct, Unlawful Compensation, Fraud & Theft