Lying to a Grand Jury is OK and our friend Al Crespo unearths even more corruption in the City of Miami...

Back in late May we discovered disturbing inaccuracies in the grand jury testimony that eventually led to the Plantation Cops mortgage fraud indictment.  From what we were able to find, the government misrepresented several important facts to the grand jury which made an already bad situation for the defendants even worse by including incorrect inflammatory statements like these...

With respect to this particular Indictment, we’re talking about the first count, which is a conspiracy count. It’s a conspiracy to commit mail fraud, wire fraud, and filing of false statement with a Government agency, the Department of Housing & Urban Development.

Counts 2 through 12 are the mail fraud counts.  Counts 13 through 25 are the wire fraud counts.  Counts 26 through 33 are the 1001 counts, which is the filing of a false statement with a federal agency.

Q. And the department or agency to which the HUD-1 is submitted is the Department of Housing & Urban Development?

A. Yes.

We now know that these statements were false and misleading, the paperwork in question is in fact not submitted to the Department of Housing and Urban Development or any other federal agency.  The government responded to the defenses motion to dismiss these charges by basically saying fuck it, let the jury decide...

II. ANY PURPORTED ERROR IS RENDERED HARMLESS BY THE PETIT JURY  Any purported errors claimed by the Defendant are rendered harmless if the petit jury convicts the defendant. See United States v. Mechanik, 475 U.S. 66, 72-73 (1986).  Based on the aforementioned argument and facts, the counts in the Indictment should stand and the defendant can be tried on the merits. "An indictment returned by a legally constituted and unbiased grand jury, . . . if valid on its face, is enough to call for trial of the charge on the merits." Costello, 350 U.S. at 363.

I was really hoping that Judge Cohn would recognize how serious these "errors" were and would then dismiss the charges in question.  Wishful thinking I guess... 

Steven Stoll Joe Guaracino Motion to Dismiss Denied

According to the judge the defendants "suffered no prejudice from the United States’ alleged misconduct and his constitutional protections were not jeopardized."  Wonderful, I'm sure the defendants feel the same way.

Now, back to the City of Miami mess for a moment, our friend Al Crepso broke another story yesterday regarding an alleged bribe that Mayor Regalado offered to embattled police chief Miguel Exposito to resign.  According to Mr. Crespo, Regalado offered the Chief $400k to leave, an offer the chief turned down because according to the chief "they couldn’t buy me or my reputation".  That's all well and good, but for those who've been paying attention to the rumors surrounding the feud between the mayor and police chief, this $400k buyout thing isn't exactly anything new.  Rumors of this alleged buyout have been circulating since early January 2011, from what we've heard the chief turned down the buyout because it would have created too much of a tax liability for him.  Regardless of the tax liability or when this "buyout" actually became public knowledge, the question that we're left with is how the hell did the mayor unilaterally decide to give the Chief this offer?  Doesn't something like this (especially of this magnitude) require the a vote by the commissioners?  Worse still, with the city tetering on the verge of bankruptcy, how can they afford to keep giving away massive severance packages like this?  How many murals and led billboards does the city have to put up in order to generate $400K?

The city is on fire folks, the mayor and the police chief publicly feuding, city buildings becoming public billboards, employees showing up part time and taking home over $300k per year, etc.  It's going to be interesting to see what's left when this is all over.
 

No deal for Michelle Spence-Jones...

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At least not today. If you believe the rumors circulating regarding her case, today was the day the state was to drop the charges against former city of Miami commissioner Michelle Spence-Jones, needless to say, it didn't happen. Her attorney, Peter Raben, was overheard telling the judge at sidebar that he was "no where near ready to go to trial". The judge then proceeded to give another status date for August 28, 2011. 

Based on what we saw today, there doesn't seem to be any "deal" on the horizon and the case seems to be headed for trial. More later.

Why are Mayoral candidate Julio Robaina's properties worth so little? Taking a closer look at Mr. Robaina's campaign qualifying documents...

I know the Miami Dade county mayoral race isn't our standard fare, bare with me though as I think what I've found may be of interest to our readers that are going to vote on Tuesday for former mayor Carlos Avarez's replacement.  I was bored the last couple of days so I decided to go through mayoral candidate Julio Robaina's qualifying documents.  Here they are in their entirety...

Julio Robaina Mayoral Candidate Qualifying Documents

At first glance there seems to be nothing out of the ordinary, that is until I came across the list of real property that Mr. Robaina owns, here it is appears on his financial disclosures, as always, click on the image to enlarge...

For the moment, let's take a look at the property identified by the first arrow which is located at 499 West 33rd street and the one just below it which is located at 455 West 33rd street.  These two addresses refer to the same shopping center, the same shopping center that our friend Frank Alvarado of the Miami New Times wrote about back in April (here's a link to that article).  From the article...

While Miami-Dade County residents paid higher property taxes last year, Hialeah Mayor and Miami-Dade County mayoral candidate Julio Robaina did not pay property taxes on a shopping center he owns in his city. In fact, it appears Robaina has avoided paying taxes on the building since 2006, when he and a business partner finished it.

Ok, so according to the article for some reason or another the Property Appraisers office only calculated the property taxes based on the land value and not the value of the complete shopping center.  Worse still, the property appraisers office takes the blame for the "miscalculation"...

"...it was the property appraiser's office's fault Robaina's building value was not recalculated."

Sounds like bullshit to me, but for the sake of our argument, let's accept that the property appraisers office screwed up and failed to collect tens of thousands of dollars from Mr. Robaina.  We've also learned from the New Times article that Mr. Robaina had borrowed in excess of one million three hundred thousand dollars against this property, with that in mind, how can you explain these numbers on his campaign qualifying documents...

According to Mr. Robaina, his shopping center is worth a total of  $75,325!  WTF?  I wonder what the bank who lent Mr. Robaina 1.3 million dollars would think of that?  Now I understand that the first screw up could have been blamed on the property appraiser not reevaluating the property after the shopping center after it was built (pffffft!) but how can we explain this miscalculation on his campaign qualifying documents?  Based on what's listed in the qualifying documents it looks like Mr. Robaina's wife prepared these documents, so is it possible she wasn't aware of what her husbands assets were worth?  

Let's move on to the property identified by the second arrow in the list of real properties owned by Mr. Robaina that we posted at the beginning of today's post, the property located at 5590 West 16th Avenue which appears to be a prosperous Chevron gas station.  From Google maps...

From the looks of it this Chevron has six gas pumps (two dispensers per pump) as well as a convenience store.  The station seems to be sitting on a prime corner and based on what a few of my friends who own gas stations have told me, the station, convenience store and business is worth upwards of 1.5 million dollars, the property alone has got to be worth in excess of a million dollars.  Based on the $610,000 mortgage Mr. Robaina obtained when he purchased the property back in 1995 the property had to be worth at least that much if not much more, so then why would he list it's value at $192,071 on his campaign qualifying documents?

I don't get it?  Once again from the campaign qualifying documents and the mortgage for the gas station, we learn that the tenant who occupies the station is a corporation that's also owned by Mr. Robaina...

Just the convenience store and it's lease for the gas station and store is worth more than what Mr. Robaina claims the whole station is worth!  What gives here folks? 

I wouldn't want to suggest some sort of impropriety on Mr. Robaina's part regarding the gross undervaluing of these two properties that we've discussed.  Maybe it's something that's easily explainable?  Perhaps an oversight by his wife who handles the day to day affairs while Mr. Robaina was busy governing Hialeah?  Really, why would anyone want to undervalue their assets in a financial disclosure anyway?

This brings us to this final detail regarding Mr. Robaina's campaign qualifying documents...

By signing these documents, Mr. Robaina swears "...that the information disclosed on this form and any attachments hereto is true, accurate and complete."  As we sit here on the eve of our mayoral election how are we to interpret the fact that Mr. Robaina swore that the facts regarding his own personal finances contained in his campaign qualifying documents are correct when it's blatantly obvious that they're not?  If Mr. Robaina isn't intimately familiar with his own finances then how can we expect him to handle the job of managing the multi billion dollar Miami Dade county government?

Putting things in perspective...

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By now you all know I have a beef with prosecutors going after low level mortgage fraudsters rather than nailing the people at the top of the food chain, the bankers and Wall Street executives that brought down our economy.  The feds recently convicted former CEO of Taylor, Bean & Whitaker Mortgage Corp. Paul R. Allen of billions of dollars worth of financial fraud.  The sentence for his crimes?  Three years.  On the other hand we have a homeless man name Roy Brown who robbed a bank of a single hundred dollar bill so he could get something to eat.  His sentence?  See for yourselves...

 

Steal three billion, get three years.  Steal a hundred bucks and get 15 years behind bars.  WTF!?

CORRECTION! City of Miami assistant fire chief Veldora Arthur is on paid administrative leave!

Yesterday one of our readers stated that City of Miami assistant fire chief Veldora Arthur was on administrative leave since she was federally indicted for mortgage fraud and was using her accumulated vacation time while on leave.  Turns out we were wrong, our contact from the fire department sent us this correction...

Veldora has been on Paid Leave for most of the past 3 months. She has in fact traveled for personal reasons during her absence but from the records i have seen; she was charged vacation time for those VACATION absences. But it is an absolute fact that aside from the few short personal trips she has taken, all of her absences over the past 3 months has been billed to the taxpayers through "Paid Administrative Leave" absences while she has been at home getting paid to watch TV, surf the web, do chores, working on her defense case,. and probably engaging in some form of 'work from home' outside employment that she has already shown a propensity for!

SHAZAM!  While the city is reported to have anywhere between a forty to eighty million dollar budget deficit this year, Veldora is sitting home collecting over $300,000 per year from the city's taxpayers!  Our contact goes on to comment on the allegation that most people in the upper echelons of the FD have gone home by 1:30 in the afternoon...

Very exaggerated. The real heroes in the fire rescue department are definitely the firefighter/paramedics out on the street saving lives and definitely not the 20 or so behind desks shuffling papers, except for Veldora, the 1:30 part is an exaggeration. Most probably work longer days that they get paid for. Veldora on the other hand has engaged in a criminal neglect of her duty to the taxpayers.

That last bit makes me wonder, "criminal neglect of her duty to the taxpayers".  Could there be an angle here?  Could this not showing up for work and now this paid administrative leave situation rise to the level of criminality?  Think about that for a moment...

Even before the federal mortgage fraud indictment, if Veldora was only showing up for work half the time while getting paid by the city to work full time, isn't that just straight up theft?  Anyone from the State Attorneys office paying attention here?  On the other hand, how about the bogus severance packages former City Manager Tony Crap and former City of Miami CFO Larry Spring gave themselves?  Doesn't that sound like Grand Theft and Organized Scheme to defraud?

It's time for someone to take action, whether from the City or the State Attorneys Office.  Enough is enough. 

It's about time. The Miami Herald finally gives credit to one of our friends and local bloggers, Al Crespo, for breaking a story.

As the title of today's post states, Chuck Rabin of the Miami Herald has finally decided to give credit to our friend and local blogger Al Crespo of the Crespo Gram report for breaking the story of former City of Miami CFO Larry Spring's illegal severance package. It's nice to finally see mainstream media like the Herald giving credit to the people who work tirelessly and for free for doing the research and breaking these kind of stories that they usually wont report on. From the Herald article...

The payout to Spring—first reported on Al Crespo’s blog, thecrespogramreportcom — has created a furor in the local blogosphere, confusion at City Hall, and anger among some city commissioners and the mayor.

So it took "furor in the local blogosphere" before the Herald finally decided to acknowledge the corruption and outright theft that's been going on in the City? After being asleep at the switch ever since Regalado was elected mayor, the Herald has finally woken up. Great.

In my opinion the Herald giving credit to Mr. Crespo for breaking the story is a milestone, Mr. Crespo says it best in the comments section of the Herald article...

To Chuck Rabin and the Miami Herald, thanks for the credit. The times are changing, and I think that you all need to not only start crediting bloggers more, but more importantly piggybacking off our of initial efforts. You can't do what we do, but we can't do what you do either.

Correct, I've always given credit to the Herald or whoever else I get a story or information from, it's about time the Herald does the same. Which leads us to Mr. Rabin's Herald article regarding City of Miami Assistant Fire Chief Veldora Arthur's federal mortgage fraud indictment story we broke a few months back. As you all remember, our blog post was published on February 21, 2011...

The very next day Mr. Rabin of the Herald writes his story about Veldora's indictment...

No big deal right? What Mr. Rabin doesn't know is that I was watching him read our blog at 9:32 in the morning on the 22nd of February hours before he wrote his story. How do I know? Take a look at our blog tracking software report for that morning (click on image to enlarge)...

Our blog analytic software tells us that the folks at the Herald were perusing through our Veldora blog post from 9:32 am through 11:37 am ripping off our story without giving us credit. No big deal Mr. Rabin, like Mr. Crespo said...

The times are changing, and I think that you all need to not only start crediting bloggers more, but more importantly piggybacking off our of initial efforts. You can't do what we do, but we can't do what you do either.

Now, let's turn to a disturbing comment we received yesterday regarding City of Miami employees Veldora Arthur and Thomas Thelusma's employment status with the City since their federal mortgage fraud indictments...

Anonymous said...

FIRE CHIEF TOOK TOM THELUSMA I.D AND BADGE AWAY BUT COCK SUCKING VELDORA ARTHUR STILL HAS HERS. VELDORA HAS NOT BE SEEN IN 2 MONTH OR LONGER. I GUESS SHE IS IN THE BAHAMAS ON TAXPAYERS PAID LEAVE ! AND YES THE BLACK THING DOES HAVE SOME MEANING , JUST GO TO THE AMINISTRATION AND SPECIALLY SUPPORT STAFF AND YOU WILL SEE HOW DARK IT IS AROUND THERE . MFD AT AN ALL TIME LOW MORALE AND WILL CONTINUE TO BE TILL THEY CLEAN HOUSE. . IF YOU THINK VELDORA IS THE ONLY ONE NOT IN THE OFFICE , JUST GO BY HQ AND PEEP IN , YOU WILL FIND NO ONE THERE PAST 1:30 PM.

June 22, 2011 10:54 AM

I wasn't sure whether or not this comment was accurate, so I reached out to one of our sources in the fire department who clarified things for us, his responses are in blue..

"FIRE CHIEF TOOK TOM THELUSMA I.D AND BADGE AWAY BUT COCK SUCKING VELDORA ARTHUR STILL HAS HERS.
I believe this was true during their respective periods of "Paid Administrative Leave" but Thelusma was only on leave for less than 2 weeks

VELDORA HAS NOT BE SEEN IN 2 MONTH OR LONGER.

True, longer

I GUESS SHE IS IN THE BAHAMAS ON TAXPAYERS PAID LEAVE !

She has in fact traveled for personal reasons during her absence but from the records i have seen; she was charged vacation time for those absences

AND YES THE BLACK THING DOES HAVE SOME MEANING , JUST GO TO THE ADMINISTRATION AND SPECIALLY SUPPORT STAFF AND YOU WILL SEE HOW DARK IT IS AROUND THERE .

Thelusma and Arthur are both black. If he means "How dark it is" = alot of blacks; there are in fact alot more blacks in the fire administrative upper ranks than there was 10 years ago, but alot of it began under the previous anglo chief not chief kemp, so Im not sure what this guys point is but its out of context.

(1)MFD AT AN ALL TIME LOW MORALE (2)AND WILL CONTINUE TO BE TILL THEY CLEAN HOUSE.
1. This is true but mostly because Fire Rescue personnel were singled out by the Mayor and received 20-30% pay cuts last year. 2-3 times as much percent as other city employees. This has nothing to do with veldora, thelusma or anything like that. 2. not true , it has nothing to do with cleaning house of veldora, thelusma or anybody else for that matter

IF YOU THINK VELDORA IS THE ONLY ONE NOT IN THE OFFICE , JUST GO BY HQ AND PEEP IN , YOU WILL FIND NO ONE THERE PAST 1:30 PM.

Very exaggerated. The real heroes in the fire rescue department are definitely the firefighter/paramedics out on the street saving lives and definitely not the 20 or so behind desks shuffling papers, but the 1:30 part is an exaggeration. Most probably work longer days that they get paid for.

I'm glad we were able to get that cleared up. As our friend says, if Ms. Arthur isn't coming to work and being charged vacation time for her absence then it's not really "paid administrative leave" like our commenters have been suggesting.

Now, regardless of how the story of the City of Miami's former CFO Larry Spring questionable and perhaps illegal severance package became public, let's see what the folks over the City are going to do about it. Once again, congrats to our friends over at the Crespo-Gram report and Investigation Miami blog for the countless hours they put in to bring these stories to light.

Indicted City of Miami assistant fire chief Veldora Arthur and firefighter Thomas Thelusma on paid leave?! And "Operation Cop out", what's in a name?

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Could this be true? Several sources as well as several of our commenters tell us that both Veldora Arthur and Thomas Thelusma have been on paid administrative leave since they were federally indicted for mortgage fraud! From our comments section...

Anonymous said...

Where the F*^k are the Cops!Veldora Arthur has been on PAID LEAVE since March! Now Thomas Thelusma has the same special 'LEAVE' Plan!! WTF I total agree that all are innocent until proving guilty BUT that doesn't mean you CANT WORK. But then again we DON'T Get IT.....because its a 'Black Thing'.

May 19, 2011 10:09 AM

While I don't agree with the "black thing" comment, the rest is very troubling if true. As we've said time and time again, we believe in the presumption of innocence, innocent till proven guilty, but this business of getting federally indicted and then being put on paid administrative leave is a bit much, isn't it?


What's even more troubling is the fact that the cops indicted in operation "Cop out" aka the Plantation cops mortgage fraud case were put on "leave" without pay after they were indicted. Why did the cops get sent home with no money while having to prove their innocence while the City of Miami fire department employees get to stay home while still raking in six figures? Worse still, with the City of Miami teetering on the verge of bankruptcy, how the hell can they justify paying these federally indicted employees while they're sitting at home? Can we really afford to have anyone sitting at home while getting paid as if they were at work?


Now, going back to the Plantation Cops mortgage fraud case, aka "Operation Cop out", we learned yesterday that the decision to go after the cops was made by FDLE special agent Dennis Roadruck...

In the spoilation hearing before this court Lead Agent Dennis Roadruck testified that he in his sole disgression limited this investigation to the cops.

I wonder what it was about the cops that caused agent Roadruck to focus his attention on them and them alone? We've been told time and time again throughout the course of this investigation and subsequent trial that the mortgage brokers involved, Rene Rodriguez and Matt Gulla, had committed hundreds if not thousands of similar frauds. Even worse, the government was not only aware of these other cases of fraud but they also had the mortgage brokers records and hard drives which contained proof of these frauds, so why did this investigation only zero in on the cops that were indicted?

You guys hash it out and we'll discuss further next time.

Great news for Deutche Bank, it looks like the may have a chance to get some of their money bank from former City of Miami CFO Larry Spring! Also, what's in a name? Another angle on the Plantation Cops mortgage fraud case aka "Operation Copout"

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You all remember the City of Miami's former CFO and "financial guru" Larry Spring, don't you?  In case you've forgotten, the "financial guru" had purchased his mothers home, stripped all the equity out of it then let it fall into foreclosure finally ending up with a nearly $250,000 judgement against Mr. Spring in favor of Deutche Bank.  

Larry Spring 14421 Polk Street Final Judgement

No big deal right?  Just another worthless judgement that the bank will never collect?  WRONG!  Today we learned from our friends over at the Crespo-Gram report that Mr. Spring is about to come into a shitload of money...

According to the documents that Mr. Crespo has unearthed, Mr. Spring is about to receive $125,734.56 for retiring from his post as the City's CFO.  I wonder, since there's no record of a satisfaction of judgement for the outstanding debt Mr. Spring has to Deutche Bank, isn't he still on the hook for the money he owes to the bank?  If indeed he is still indebted to the bank, since both Deutche Bank and Morgan Stanley both received federal bailout money, Mr. Spring actually owes the money to the American taxpayer as well!  With that in mind, do you think Mr. Spring is going to run and hand over the proceeds of his severance package to the banks who have a six figure judgement against him?  Somehow I doubt it.  If you do feel that Mr Spring aka the City of Miami's "Financial guru" should pay back the money he rightfully owes, then you may want to contact the attorney who got the judgement against him.  From the recorded final judgement...

That would be Meaghan Dunne Esq who can be contacted at mdunne@defaultlawfl.com. I'm sure she'd love to hear about Mr. Spring's recent windfall.

Our comments section has been jumping this weekend, specifically the last post we made regarding the Plantation Cops mortgage fraud trial.  From the comments we get this gem...

I've asked this several times... Why only the cops? Why not rene or matts family members? Why was this whole case called" Operation Copout" in 2008, when the officers were never even interviewed yet??? Let's call a spade a spade...

WTF?  This is the first time I've heard the Plantation Cops case referred to as "Operation Copout".  Take another look at that comment, think for a moment if the commenter is correct and the operation was labeled "Copout", does that mean that the feds went in from the get go to bring down fellow law enforcement officers?  Could this explain why the feds have all but ignored the hundreds if not thousands of frauds the mortgage brokers Rene Rodriguez and Matt Gulla have been involved in?  We'll have to take a closer look at this angle...

The anatomy of a rat, a little known fact about defendant Rene Rodriguez, Jr.

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It's an age old scam, a group of people get caught committing a crime which then triggers a race to the prosecutors office to see who can cut a deal first to save their own ass by selling out their co-conspirators.  Sometimes people are forced to cut these kind of deals because they don't have the money to defend themselves or worse when the mountain of evidence before them is insurmountable and there's no sense in going to trial.  In these cases the only way out may be to cut a deal and give the government whatever they need to bury the other defendants.  Not exactly the honorable thing to do but whatever.


There's another reason to turn on your cohorts and cooperate with the government.  What if you're a seasoned career criminal who knows that they can get out of just about any crime and be back on the street to commit more crime by simply cooperating with law enforcement and prosecutors?  Wouldn't that give you an air of infallibility and the license to do just about anything you wanted?  Think about it, forge some documents?  Fuck it, I'll cut a deal.  Fabricate fake tax returns?  Fuck it, I'll cut a deal.  Scam customers and rape them with exorbitant fees?  Fuck it, I'll cut a deal.  Screw banks out of millions of dollars?  Fuck it, I'll cut a deal.  As long as there's a bigger fish than you in your group, you'll be good to go.

Now, coming back to the Plantation Cop's mortgage fraud scheme, the two most important cooperating witnesses for the government till now have been the two mortgage brokers, Rene Rodriguez, Jr and Matt Gulla.  From what we've been able to find, these two mortgage brokers were at the very epicenter of hundreds if not thousands of mortgage frauds as well as the ones that were included in the Plantation Cops federal mortgage fraud indictment.  Who knows exactly what their reasons were, but they were the first ones to run to the government to cut a deal and cooperate against the remaining co-defendants.  Like we said earlier, nothing strange about this, standard operating procedure for people caught committing a crime that are trying to find the easiest way out.  

While the indictment against the Plantation Cop's was filed in mid 2010, it seems like Rene Rodriguez and Matt Gulla were racing to the prosecutors office to cut a deal as early as late 2008/early 2009.  No big deal right?  While going through the voluminous files that are part of this case, I came across an interesting bit of information over the weekend, it turns out that during the peak of the real estate boom, around 2005, the same time frame that the homes that were included in the federal indictment were bought and sold, Mr. Rodriguez was cooperating with the government on another case!  Think about that for a moment.  How do you think Mr. Rodriguez's business partners, friends and clients would have behaved if they knew that he was a cooperating witness on another case?  Remember that air of infallibility we spoke of?  Do you think Mr. Rodriguez's judgement may have been impaired when he was forging all those mortgage docs, creating all that bogus paperwork, raping banks out of millions of dollars all the while knowing that if the shit hit the fan he had a get out of jail free card in his pocket?  From the opening statements...

In furtherance of his cooperation, am I able to go into that, he learned from an early stage, once his hand is caught in the cookie jar, how to get it out nice and clean? He learned once he gets caught, instead of accepting responsibility and does what he does, he plays the cooperation game so he could get back on the streets into his nefarious activities.

What's really disturbing about Mr. Rodriguez and his previous history of cooperation is that for some reason or another, the judge doesn't want the jury to hear about it!  Anyone have an angle on this?  We'll discuss Mr. Rodriguez's cooperation further tomorrow.

Update on Michelle Spence-Jones case...

The word on the street was that the state was going to drop the charges against former City of Miami commissioner Michelle Spence-Jones today. This morning her attorney Peter Raben and prosecutor Richard Scruggs appeared in court and asked for the case to be reset till June 28. We'll have to wait a few more weeks to see what the state does...

Finally, someone points the finger at the banks!

We've heard the government blaming mortgage brokers, lawyers, borrowers, etc time and time again, all the while ignoring what we called the "unindicted co-conspirators", the banks that actually made the loans.  Now we finally have someone that's pointing the finger directly at the banks that were at the root of the mortgage and real estate meltdown.  Defense attorney Michael Walsh in his opening statement in phase two of the Plantation cops mortgage fraud trial introduces the jurors to the "unindicted co-conspirators", from his opening statement...

It can't be the banks with all their investment bankers, all their certified financial planners, all their lawyers, all their licenses, all their charters.

Of course not!  They wouldn't dare commit a crime let alone financial fraud?!  Remember, it wasn't the banks fault, the blame was squarely on the borrowers and the brokers who lied on their loan applications...

Mr. Sullivan told you the banks are going to tell you that they relied on that. You will not hear from a single person, not one, nada, not a single person who processed a single loan in this case. Do you know where those people are?  Neither do I, neither does the Government.

Exactly!  It wasn't the banks or the people at the banks whose responsibility it was to process these loans or verify what was on the applications fault for dolling out all the money to these people who allegedly lied on the loan applications!

Every single bank, not the bank by name, but the individuals in the bank were criminals, and you will hear that the Government hasn't indicted a single banker except for one for all the stuff they did.

It was the banks and their reps that told the brokers what they needed in order to fund these loans, they set the guidelines for the debt to income ratios, they set the requirements for employment, etc.  It wasn't up to the broker or the borrower to approve the loans, it was strictly up to the bank.  The banks could have easily called and verified what was on the applications, but they chose not to, they chose not to as they needed to hand out the money as fast as they possibly could so they could resell the loans and make more money.

These institutions, call them the big banks. Little banks, obviously, LB, little banks. Little banks is where the crooks worked at, crooks, not people who would be guiled, but people in the business of beguiling, people who like to -- people who lie. I could use big words. When it comes down to it, it is a lie.

These little banks and these crooks, Matt Gulla and Rene Rodriguez, what they did, what they did is, on every single real estate transaction they made, guess who got paid? Matt and Rene, between five and $25,000 per loan. Guess how many people they committed fraud to? Every single loan they ever processed. Not just for the defendants the Government has decided to prosecute, but each and every single loan.

Nothing new here, just the first time that I know of that an attorney has decided to bring in the banks who till now have claimed that they were a victim of these alleged fraudsters.

What happens, John Q. Public, anybody that went into them, came into Matt Gulla and Rene Rodriguez -- Matt Gulla and Rene Rodriguez were in bed figuratively, in the criminal bed with the little banks and crooks. Why?  Because the little banks would take all these loans that they committed fraud on, package them up and sell them to the big banks, and the big banks would pay them.

So, in other words, A would borrow money from B. A's money would be paid back by C. The big banks never cared if B paid them back, if B did, that was icing on the cake.  The little banks, the money they lent to these borrowers through extortion is loans, predatorial type loans did everything. The fraud that is on the loans was perpetrated by the mortgage brokers and the banks.


So, these loans that the banks and mortgage brokers scammed up, that is why you will see the fraud in there, they sold them to the big banks and they hid all that fraud.

Taking into account what Mr. Walsh has outlined in his opening statement and the facts that we're already all to familiar with regarding the lenders complicity in these loans, why hasn't the government gone after any of these lenders?  Think of the tens of millions of dollars that state and federal prosecutors have spent prosecuting these crimes yet to date they haven't gone after the real culprits?  This is no different than law enforcement targeting the corner drug dealer but never going after the kingpin who's growing, processing and importing the drugs.  When will a prosecutor grow a pair and finally file charges against these banks? 

Too damn tired.

Too tired after the Heat game to bang out a meaningful post today.  I'd like to throw a bone to the commenter that left this comment yesterday...

Can we please get an update on the plantation mortgage fraud case? As you can tell from the amount of comments on past posts - everyone visits this blog for that. Thanks.

While I disagree about your assertion that everyone visits our blog to read about the Plantation cops mortgage fraud case (our stats are actually higher when we write about the City of Miami misdeeds), here's a video that brings us back to the heyday of the real estate boom...

The two guys in the end of the commercial are non other than Rene Rodriguez (the bald dark skin guy) and Matt Gulla, the crooked mortgage brokers that pled guilty and are now cooperating with the government against the other co-defendants in the Plantation cops mortgage fraud trial.  I find the "family" image with the kids and all so amusing, while these career criminals who have confessed to committing hundreds if not thousands of frauds from 2001 to the date they were actually busted are out robbing banks blind.  They have the nerve to show put together commercials like this with their kids in order to portray a trusting wholesome image only to have them just a few short years later sell out their clients and business associates in order to save themselves from serious jail time. 

Working as the City of Miami Assistant Fire Chief is Veldora Arthur's second job!

YIKES!  We investigated rumors of City of Miami Assistant Fire Chief Veldora Arthur having more than one job while working for the city a few months ago, we've now come across a new document that confirms that not only did she have more than one job, but that indeed she considered her job at the City as a SECOND JOB!  Let's take a look at this page from a 1003 residential loan application that we came across...

Amazingly enough in this application Ms. Arthur lists her primary employment as the CEO "Gateway Associates, LLC", she lists her City of Miami employment as "2nd job income City of Miami".  A quick look at the Florida department of State website reveals that Ms. Arthur has never had any role in "Gateway Associates, LLC", let alone one as a CEO.


I guess making over $300,000 from the fire department isn't enough to qualify as a primary income these days!  Tomorrow we're going to see what happened to the $1,132,740.46 Veldora had sitting in an account at Suntrust bank...

Where in the world does City of Miami Assistant Fire Chief Veldora Arthur live?

Great question right?  We know that she certainly didn't live in the two units she purchased that were part of the federal mortgage fraud indictment filed against her a few months ago, according to our readers, Ms. Arthur has always lived in Weston Florida.  That's all well and good, remember, according to the federal indictment...

...Arthur received a payoff yet had no intention of living on the properties, which eventually went into foreclosure.

Understood,  according to the feds, Ms. Arthur was nothing but a straw buyer, her attorneys contention was that she had no idea that the people she was associating with were committing fraud.  Ok, so how do we explain this letter that Ms. Arthur wrote and faxed from the City of Miami fire department at 12:06 pm June 27, 2006?

In this letter to the lender she clearly states that:

“In regards to the statement regarding my residency, I have never stated to any official at Loan City or any other agency that I don’t reside at 3370 Hidden Bay Drive, Unit 3711. That statement is totally false as I have been residing there since I purchased the unit.” 

I suppose that if we were to believe her attorney, the people she was doing business with who got her into this mess must have snuck this letter into the City of Miami Fire Departments fax machine and sent it off to the bank in question?

Things aren't looking to good for Ms. Arthur at this point are they?  As if this wasn't bad enough, we've uncovered some new  documents that are far worse that are really going to make you wonder who we have controlling finances over at the City of Miami Fire Department... 

The Miami Herald calls the City of Miami CFO a "Financial Guru"? WTF?!

Our friends over at Investigation Miami tell us that the Miami Herald is calling the City of Miami's recently departed CFO a Financial Guru!  You all remember Mr. Larry Spring don't you?  This would be the man who purchased his mom's home, stripped the home of all it's equity through a questionable refi where he lied about the home being his primary residence then let the home fall into foreclosure.  Does any of that sound like the work of a financial guru or does it sound like the handiwork of a financial fraudster?

Now, let's take a look at a document that should make Mr. Spring proud...


Larry Spring 14421 Polk Street Final Judgement


What's that you say?  It's the final judgement in favor of the bank that lent Mr. Spring the money for the pump and dump he pulled on his mom's old home.  According to judgement, Mr. Spring owes Deutsche Bank $223,048.29 as a result of the scam he pulled.  Does that sound like something Mr. Spring would want to have on his credit report when looking for his next job?  The subject of people with bad credit looking for employment was discussed Sunday night on CBS4, take a look...

What's this?  Employers check job seekers credit before hiring?  The rationale is that if your credit is in the toilet and lenders have deemed you not credit worthy, you're more likely to commit some sort of fraud on the job, it makes sense to me.  With that in mind, can anyone figure out how Mr. Spring was allowed to keep his job as the City of Miami's CFO considering his foray into mortgage fraud?  Even worse, now that his misdeeds concerning his personal finances are public, where's he going to go?

That brings us back to the Herald's description of Mr. Spring's being a "financial guru".  After watching him literally lead the City into bankruptcy through questionable financial moves and goofy bond refinancing schemes, not to mention the financing games and subsequent foreclosure action on his mom's old home, you have to wonder how the hell the Herald could possibly conclude Mr Spring was a "financial guru".   What was Herald columnist Michael Vasquez on when he decided to call Mr. Spring a financial guru? 

Meanwhile back at the Florida bar, anyone up there ever hear of an attorney named Howard Kusnick?

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Disgraced former attorney and convicted ponzi schemer Scott Rothstein has been back in the news lately, last week one of his partners in crime and fellow attorney Howard Kusnick was charged for helping Rothstein perpetuate his billion dollar ponzi scheme.  The South Florida Business Journal covered the story here, from the article...

Kusnick is alleged to have written a letter purporting to settle pending litigation in favor of a client, but it is alleged no litigation ever took place and no settlement ever existed. Instead, the letter was “to lull the clients into believing that RRA was pursuing litigation on their behalf when, in fact, the clients’ funds had been used to pay off earlier investors and to further the investment fraud scheme,” according to a news release from the U.S. Attorney’s Office in Miami.

Now, this isn't some nickle and dime case but instead a scam that was engineered to cheat auto dealer magnate Ed Morse out of $57,000,000!  Take a look at the information filed by the feds for the details...

Howard Kusnick Information


To add insult to injury, it looks like Mr Kusnick even went so far as to forge a judges signature on some the documents pertaining to this case...

Howard Kusnick Order


Nice right?  Not only did this attorney take part in a $57,000,000 scam but in doing so he also forged a federal judges signature on several documents pertaining to the bogus settlement!  Even worse, when the Rothstein ponzi scheme imploded, Kusnick almost immediately hired a criminal defense attorney and openly acknowledged his role in the scheme and volunteered to the media that he expected to get federally indicted at any moment.  So what's the big deal?  Considering that this case has been going on for nearly two years and the admissions made by Mr. Kusnick and his attorney, not to mention the fact that he's been charged federally for some of the most heinous crimes an attorney could possibly commit, what do you think the Florida Bar which touts itself as being the "...guardian for the integrity of the legal profession" has done about Mr Kusnick?  Let's take a look at his profile from the Florida Bar's website as it appears today, I've pointed to the most troublesome parts...

SWEET!  The guy has admitted to his role in Rothstein's various multi million dollar frauds, admitted to forging a federal judges signature, has been federally charged for his crimes and the Bar hasn't taken any kind of action against this guy?  Not even an emergency suspension?  What the hell is going on over at the Bar?  Aren't they supposed to protect us from criminals attorneys like this?  WTF?  For fucks sake, this has been going on for nearly two years and he's still allowed to practice?!  If the bar doesn't go after attorneys like Kusnick, crooked attorneys like David Rodriguez or morally and ethically prosecutors who can't seem to tell the truth to save their lives, then what exactly are they doing?!

The governments answer to the allegations of prosecutorial misconduct during the grand jury proceedings for the Plantation Cops mortgage fraud case.

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Yesterday we discussed the allegations of prosecutorial misconduct by the government during the grand jury proceedings which led up to the Plantation cops mortgage fraud indictment.  Specifically it's alleged that the government lied to the grand jury when they claimed that the subjects misrepresented facts on HUD-1 forms that were submitted to a Government agency, the Department of Housing & Urban Development.  Our contention is that this is patently false as these loans were neither FHA loans or loans that were underwritten by the government therefore making the prosecutors allegations of "submitting false information to a government agency" an outright lie.

As shocking as these allegations of prosecutorial misconduct before the grand jury were, I was even more startled at the prosecutors response to the allegations, take a look for yourselves...

Governments Response to Steven Stolls Motion to Dismiss

I find this bit the most disturbing...

II. ANY PURPORTED ERROR IS RENDERED HARMLESS BY THE PETIT JURY
Any purported errors claimed by the Defendant are rendered harmless if the petit jury convicts the defendant. See United States v. Mechanik, 475 U.S. 66, 72-73 (1986).
Based on the aforementioned argument and facts, the counts in the Indictment should stand and the defendant can be tried on the merits. "An indictment returned by a legally constituted and unbiased grand jury, . . . if valid on its face, is enough to call for trial of the charge on the merits." Costello, 350 U.S. at 363.

Really?  So the government says disregard the fact that we may have made a horrific mistake (perhaps intentionally) when we convinced the grand jury to indict, now since we're in front of another jury, let them figure it out?  If the "petit jury" convicts, the errors we made are harmless?  How about taking into consideration that if you didn't make these "purported errors" the grand jury may not have indicted the poor schleps that are now before the "petit jury"?  

I can only imagine the rage the defendants must have felt when reading this motion.  Oh well, like the government says, fuck it, let the jury figure it out...