New Congressman David Rivera made quick condo sale, repaid debt

Article Courtesy of The Miami Herald


Published January 7, 2011 


The newly minted congressman sold an apartment to his mother's company around the same time he says he repaid a $132,000 debt to the same company.

Only eight days after winning election to Congress, David Rivera sold a condominium to his mother's company in an effort to stave off increasing questions about his personal and campaign finances -- and an unfolding criminal investigation.

The Nov. 10 sale was completed around the same time that Rivera says he repaid $132,000 in undisclosed loans he received from Millennium Marketing, a company run by Rivera's mother and godmother. The two-bedroom condo at 8897 Fontainebleau Blvd. in West Miami-Dade had an assessed value last year of $89,000, county records show.

Rivera's relationship with Millennium is at the heart of a criminal probe of his personal and campaign finances by the Miami-Dade State Attorney's Office, the Miami-Dade Police Department and the Florida Department of Law Enforcement.

The investigation cast a shadow over Rivera's swearing-in Wednesday as part of the Republican Party's new freshman class in the U.S. House of Representatives. Not long after the ceremony, reporters asked the new Republican majority leader, Eric Cantor, whether Rivera would be disciplined under his"`zero tolerance'' ethics policy. Cantor would not comment.

The terms of the condo sale were not disclosed in the deed. But in a new financial disclosure form Rivera submitted to Congress on Monday, the lawmaker said he made more than $100,000 from the sale of real estate in 2010, according to an Associated Press report.

After taking the oath of office, Rivera refused to answer any questions about the condo sale, and he did not respond to written questions sent to his staff.

"I've said all I'm going to say about that,'' Rivera told a reporter outside his congressional office in Washington.

Rivera, 45, was considered a rising star in the Florida GOP after serving eight years as an influential lawmaker in the state House of Representatives. But after his election on Nov. 2, he has come under increasing scrutiny as prosecutors and police examine a secret deal between Rivera, Millennium and Flagler Dog Track in 2006.

That year, Rivera agreed to manage the parimutuel's $6.7 million campaign to win voter approval for slot machines in Miami-Dade County. Since the successful 2008 campaign, Rivera had repeatedly denied receiving any money for his work on behalf of the track.

But Flagler did pay $510,000 to Millennium Marketing, the company run by Rivera's mother, Daisy Magarino, and his godmother, Ileana Medina. Medina founded Millennium in September 2006, about a month before the contract with Flagler was signed, records show.

Millennium also received $30,000 in 2006 from Rivera's campaign account for consulting and a "thank you campaign,'' records show.

On Dec. 16, Rivera filed an amendment to his federal financial disclosure form, acknowledging for the first time $132,000 in undisclosed loans he received from Millennium. Later that night, The Miami Herald and WFOR-CBS 4 television first reported the criminal investigation of Rivera and Millennium.

"At the time that I filed my [financial] statement last June, I believed that I was not required to report these transactions,'' Rivera said in a letter to the House of Representatives. He said he amended his congressional disclosure form "out of an abundance of caution.''

In the letter, Rivera said he repaid the $132,000 in loans "with interest'' after the Nov. 2 election. Rivera has not responded to requests from The Herald for the loan documents or records verifying the repayment.

The deed for the condo sale, recorded with the Miami-Dade Clerk of Courts on Dec. 22, does not indicate whether any money changed hands. The documentary stamp tax on the transaction indicates the value of the sale as $100. Magarino and Medina are listed as witnesses to the transaction, and the deed was notarized by Medina. Both women also own units in the same apartment complex, records show.

Typically, documentary stamp taxes are owed on a real-estate transaction if something of value is exchanged -- or if a debt is forgiven in exchange, said Jim Kracht, an assistant county attorney who specializes in property taxes.

This week, Rivera also filed with Congress his financial disclosure form for 2010, months before the document was due. Rivera's spokeswoman, Sarah Bascom, said he filed the form "in order to dispel any speculation surrounding his personal finances.''

Rivera has refused to provide The Herald with the new financial statement, which is not yet a public record.

According to the Associated Press, which reviewed the document, Rivera listed income between $15,001 and $50,000 in 2010 from the redemption of U.S. savings bonds, and between $8,000 and $22,500 from the sale of stock.

Earlier this week, Rivera also amended four years of financial statements that he submitted to the Florida Commission on Ethics during his tenure in the state Legislature.

Rivera had also failed to disclose the Millennium loans while in the Legislature. In a letter to the ethics commission, Rivera's attorney, Richard Coates, said Rivera believed he did not have to disclose the loans under state rules.

Rivera had previously amended his state financial forms in October, after The Herald reported that Rivera's listed employer for seven years, the U.S. Agency for International Development, said it had never hired Rivera or his consulting firm. Rivera omitted any reference to USAID in his amended statements.

David Rivera discloses $137,000 in loans for slots campaign