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by Jay Gallagher

Tuesday, April 20, 2010

Cuomo: Bronx senator ripped off taxpayers

How do you know it's Earth Day in Albany? When more dirt keeps getting shoveled on politicians.

The target this time: State Senate Majority Leader Pedro Espada, who was accused today of taking $14 million from his health-care clinic for his personal use, including $80,000 in meals and trips to Puerto Rico, Miami and Las Vegas.
The lawsuit was filed today by Attorney General Andrew Cuomo against Espada, who is president and CEO of Soundview Health Clinic in the Bronx, a largely taxpayer-financed facility.
Cuomo charges that Espada, D-Bronx, who switched parties last summer to give Republicans control of the Senate before switching back, of using the facility to secure a $9 million severance package for himself while running up $450,000 in credit card bills and $100,000 in campaign expenses.
"Taxpayer money was given to this not-for-profit to provide health-care services to underprivileged patients, but our investigation has found the funds flowed into the pockets of Sen. Espada and his supporters," said Cuomo, a likely candidate for governor this year. "Siphoning money from a charity would be egregious under any circumstances, but the fact that this was orchestrated by the State Senate Majority Leader makes it especially reprehensible.''
Espada refused to answer questions about the probe today, beyond calling it a “witch hunt’’ and saying Cuomo is retaliating against him for his role in last June’s coup that briefly gave control of the Senate to Republicans.
Cuomo seeks removal of Espada as president and CEO of the institution as well as the ouster of other employees and board members, several of whom are related to the senator, who approved the deals.
Among the findings of the probe, according to Cuomo:
-- Soundview gave Espada a severance package worth an estimated $9 million. The provision unconditionally guarantees Espada the payment of one year's gross pay for every year of service. If the clause were triggered, Soundview would be forced into bankruptcy.
-- Soundview paid about $80,000 in restaurant bills for 650
separate meals for Espada or his supporters. This includes more than 200
meals totaling more than $20,000 from two sushi restaurants.
-- Soundview paid for trips for Espada, his wife and his family to
such places as Las Vegas, Miami, and Puerto Rico as purported business
-- Soundview has provided Espada with what is essentially an unlimited
line of credit on a corporate American Express card. From 2006 through
mid-2009, Espada charged more than $450,000 in items he later identified
as personal.
-- Soundview gives Espada 14 weeks of annual leave on the first of
each year and allowed him to convert it to its cash equivalent to pay personal expenses. In this way, Soundview extended Espada more than $75,000 in credit, a violation of the New York State Not-For-Profit Law.
-- Espada created a company that offered janitorial services, put his
son, Pedro Gautier Espada, in charge of it, and then Gautier rigged the
bids to make sure it won the Soundview contract, which is worth almost $400,000 a year. In 2008, Pedro Gautier earned more than $150,000 from the for-profit company and from Soundview.
-- More than 150,000 pieces of Espada's campaign literature at a cost of $100,000 were paid for by or funneled through Soundview.
-- Soundview routinely pays for political campaign expenses put on Espada's American Express card.
-- Soundview provides Espada, who lives in Mamaroneck, Westchester County, with a housing allowance of about $2500 a month to pay for a Bronx co-op which Espada claimed as his legal residence for purposes of his 2008 Senatorial campaign.

Cuomo said the probe "is ongoing and developing.'' One Cuomo aide said he expected criminal charges will be forthcoming.

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