MIAMI (CBS4) – The Miami Dade State Attorney’s Office is investigating more than half a million dollars in secret payments from the owners of Flagler Dog Track to a company operated by Congressman-elect David Rivera’s mother.
The bulk of the payments were made in 2008 after Rivera successfully helped lead a countywide referendum to allow slot machines at pari-mutuel facilities such as Flagler.
“We are certainly cooperating with authorities in doing anything we can to resolve this,” Flagler CEO Barbara Havenick told CBS4 News.
Flagler’s attorney, Roberto Martinez, said the organization did nothing wrong and that the contract they entered into for Rivera’s services was perfectly legal.
Sources familiar with the investigation say prosecutors are still trying to determine if any laws were broken and whether Rivera received any of the money paid to Millennium and if he deliberately tried to hide that income.
Rivera has always denied he was paid for his work during the referendum and Rivera has never reported any income from the campaign on any of his financial disclosure forms.
In the past six weeks, investigators have issued “dozens” of subpoenas for banking and other records relating to Rivera and the gambling issue, according to sources.
Thursday afternoon, Rivera again denied he personally received any of the money paid to Millennium.
“Mr. Rivera has not been contacted about any investigation, nor do we believe there are any grounds for an investigation,” Rivera Spokeswoman Sarah Bascom said in a statement. “We will not be commenting on any alleged investigation.”
Prosecutors recently obtained a copy of a consulting contract which contains Rivera’s signature. CBS4 News was allowed to review a copy of the 2006 consulting agreement which detail what Rivera’s duties would be in the 2008 referendum campaign. Rivera would “Act as Top Leader of Chain of Command of All Campaign Consultants & Campaign Activities” and included in his responsibilities was the “Identification & Neutralization of Opposition.”
The contract states that in return for Rivera’s services, Millennium Marketing Inc. would be compensated. According to Flagler attorney Roberto Martinez, it was Rivera’s idea for all payments to be made to Millennium.
Millennium’s president is Ileana Medina and its vice president, secretary, and treasurer is Rivera’s mother, Daisy Magarino. The company reportedly operates out of a townhouse at 1316 SW 135th Place, but a woman answering the door recently refused to answer any questions.
Medina, who is Rivera’s Godmother, also refused to respond to questions.
Under the contract, Millennium was paid $50,000 immediately after the contract was signed in November 2006.
Then starting in January 2007, Millennium earned an additional $18,181 a month in consulting fees until the referendum occurred on January 29, 2008. As a result in February 2008, Millennium was paid approximately $210,000.
And because the referendum passed, Millennium was paid a $250,000 bonus in March 2008.
Total payments to Millennium: More than $510,000.
But according to the contract reviewed by CBS4 News, Millennium is also entitled to a second bonus of another $500,000. Under the terms of the contract, because the referendum passed, Millennium accrued $20,000 a month in bonuses for the 25 months following the election.
That money has not yet been paid to Millennium because, according to Martinez, neither Rivera nor Millennium has asked for the money. Instead they are allowing Flagler to hold it for them.
One of the oddities of the arrangement between Flagler and Millennium is that none of the money was paid through the Political Action Committee the owners of Flagler Dog Track set up to run the slots campaign. Flagler and Calder Race Course each contributed more than $3 million to the Vote Yes For A Greater Miami Dade PAC and used that money to hire scores of political consultants. Those payments were all reported on the quarterly campaign finance reports the PAC was required to file.
By not paying Millennium through the PAC, Flagler avoided making those payments public. Martinez, Flagler’s attorney, said the track was not trying to hide its payments for Rivera’s services. He said the agreement with Rivera pre-dated the establishment of the PAC.
But it does appear that the Havenick family, owners of Flagler Dog Track, has tried to hide their business relationship with Rivera.
A few weeks ago, before the existence of the secret contract between Flagler and Millennium was confirmed, Flagler Vice President Isadore Havenick denied Rivera had been hired for the 2008 slots campaign.
“He gave us advice, but he was never hired by us,” Havenick told The Miami Herald. “He knew that gambling proceeds could help the state’s education budget.”
Likewise Rivera was less than candid regarding his role in the campaign. In an interview with CBS4 News, Rivera said: “What I did was support the initiative as many other elected officials did but was not paid by the campaigns at all whatsoever, one iota.”
On Thursday, Rivera’s spokeswoman Bascom said: “In 2006, Millennium Marketing, a company owned by a close family friend of David Rivera’s, was contracted to provide consulting services for the Flagler Dog Track and other related companies relating to the 2008 slots referendum. As part of that valid and legally executed contract, Rivera was designated by Millennium as its point of contact, acting as its on-the-ground strategic adviser. Rivera has never received income from either Flagler Dog Track or Millennium Marketing, Inc.”
Bascom’s statement made it appear that Flagler hired Millennium and Millennium just happened to hire Rivera. But Flagler attorney Martinez made it clear in an interview that Flagler’s interest was in hiring Rivera and that it was Rivera who brought Millennium into the discussion. In fact, state records show that Millennium wasn’t even created until just prior to the agreement with Flagler was signed.
When Bascom was notified of that fact, she issued a new statement, declaring:
“Mr. Rivera’s first discussions with Flagler were through then-owner Fred Havenick, who first discussed with Rivera the possibility of Rivera being involved in the 2008 referendum and has since passed. Mr. Rivera met Mr. Havenick because of Mr. Rivera’s extensive involvement in the 2005 referendum, for which he similarly received no income. Mr. Rivera does not recall who broached the subject first, but does specifically recall being invited to Mr. Havenick’s home after the 2005 referendum to discuss the idea with Mr. Havenick.
“Later on, after Mr. Havenick’s death, when Flagler expressed interest in moving forward with the idea, Mr. Rivera suggested the agreement be formally memorialized with Millennium. Flagler agreed that was the best way to proceed. Respectfully, Bobby Martinez had no participation in or knowledge of any of the discussions with Fred Havenick or any other family members after Mr. Havenick’s death.”