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11 ethics counts filed against U.S. Rep. David Rivera

Already facing FBI probes and a daunting re-election, U.S. Rep. David Rivera was charged Wednesday by state authorities with 11 counts of violating ethics laws for filing bogus financial disclosure forms, misusing campaign funds and concealing a $1 million consulting contract with a Miami gambling business while serving in the state Legislature.

Investigators with the Florida Commission on Ethics found that Rivera's secret deal to work as a political consultant for the Magic City Casino — formerly the Flagler Dog Track — created a conflict of interest for the lawmaker. The ethics panel also found that the Republican broke state ethics laws by failing to fully disclose his finances from 2005 to 2009.

Rivera was first elected to the Florida House of Representatives in 2002. He won re-election in 2004, 2006 and 2008.

Rivera signed a consulting contract with the Magic City Casino's owners in 2006 to run a campaign to win voter approval for slot machines at Miami-Dade pari-mutuels. But Rivera had the money from the deal sent to Millennium Marketing, a company founded by his mother and godmother, records show. Rivera then received at least $132,000 back from Millennium — money that Rivera has called loans that did not have to be disclosed.

The ethics commission charges that the Magic City Casino was attempting to influence his vote in the Legislature, where Rivera had also backed legislation favored by the gaming industry. Both Rivera and Magic City's owners have denied that the consulting contract was an attempt to influence legislation.

In a letter provided to the ethics commission, Rivera's godmother, Ileana Medina, described Rivera as a subcontractor to Millennium on the slots campaign. But Rivera's mother told prosecutors in a sworn statement last year that Millennium was a "nonexistent" company created at Rivera's request, records show. The casino ultimately paid $700,000 to Millennium.

Rivera, elected to Congress in 2010, has denied wrongdoing, and he may fight the charges in an administrative hearing. The charges could lead to civil fines of up to $10,000 per charge.

Rivera issued a statement Wednesday calling the ethics charges "false," and criticizing the ethics commission for releasing its findings so close to Election Day.

"There is absolutely no legitimate reason for the Commission to have acted now on these old politically motivated claims, which have already been dismissed by other authorities, other than to try and influence the outcome of this election for its own agenda," Rivera said.

The commission was originally scheduled to consider the complaints against Rivera on Sept. 6, but the hearing was postponed at Rivera's request, records show. Last week, Rivera's attorneys again tried to delay the case until after the Nov. 6 election, and Rivera himself contacted a commission member seeking a delay. Ken Pruitt, the former president of the Florida Senate, also tried to intervene on Rivera's behalf, records show.

The commission first began investigating Rivera in 2010, following complaints triggered by Miami Herald articles about discrepancies in Rivera's financial disclosure reports. Ethics investigators suspended their probe when the Florida Department of Law Enforcement and the Miami-Dade state attorney's office launched a criminal investigation of Rivera's finances and the Magic City deal.

Miami-Dade prosecutors dropped the probe in April, saying the statute of limitations and toothless election laws prevented prosecution. When the criminal probe ended, the ethics commission then resumed its investigation, said Kerrie Stillman, a commission spokeswoman.

"We don't choose the timing of our investigations," Stillman said.

In a flurry of television interviews Wednesday afternoon, Rivera claimed the case was rammed forward by the ethics commission's chairwoman, Fort Lauderdale attorney Susan Horovitz Maurer, a Democrat. The commission is comprised of five Republican members and four Democrats.

The commission also accused Rivera of using campaign funds for personal use, relying on the FDLE's finding that Rivera used campaign donations to pay off expenses on his personal credit cards. Rivera's lawyers argue that the credit-card payments were intended to cover past campaign expenses that Rivera paid personally. Rivera has said that he's still owed $75,000 for campaign costs he paid out of his own pocket.

Rivera also filed false or incomplete financial disclosure forms between 2005 and 2009, the commission found. Investigators said Rivera should have reported the Magic City payments through Millennium as income, and he also failed to report some real estate and a small number of stock holdings.

In addition, Rivera claimed he received income from phantom sources. For several years, Rivera said he worked as a contractor for the U.S. Agency for International Development. But USAID told the Herald and FDLE investigators that the agency never hired Rivera or his company.

Rivera's lawyers told the ethics commission that Rivera did "international public diplomacy" work through an aid organization that he believed was paid through USAID. However, neither Rivera nor his attorneys have named this organization, and FDLE agents found no evidence of any such income during the investigation of Rivera's finances.

The FBI and IRS are also investigating whether Rivera should have paid taxes on the Magic City money.

The ethics commission's charges come as Rivera is facing a separate FBI probe into his suspected role in secretly financing the campaign of neophyte congressional candidate Justin Lamar Sternad, who ran in the Aug. 14 Democratic primary against Rivera's current challenger, Joe Garcia. Rivera has denied any role in Sternad's campaign.

Several polls, including one conducted by Republicans, show Rivera trailing Garcia, whom Rivera defeated in 2010.

Rivera's ethics charges are "embarrassing to our entire community," said Abel Iraola, a spokesman for the Garcia campaign. "Hopefully after Nov. 6 we can turn the page on Rivera's scandals and get back to helping South Florida's residents."

Rivera has decried the ethics probe as politically motivated, noting that it was sparked by a complaint filed by attorney William Barzee, a frequent Garcia campaign donor.

A second complaint was filed with the ethics commission by Jackson "Rip" Holmes, a Coral Gables gadfly and occasional political candidate once prosecuted for threatening Jeb Bush in 1988.

11 ethics counts filed against U.S. Rep. David Rivera 10/24/12 [Last modified: Wednesday, October 24, 2012 6:40pm]
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