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CRESPOGRAM REPORT

MARCH 26, 2014

AND WHEN DID SHE DO IT
WHAT DID SHE DO

March 21, 2013



Mr. Daniel Alfonso

CITY MANAGER

City of Miami

400 SW 2nd Avenue

Miami, FL 33130


Mr. Eli Feinberg

Chairman

CITY OF MIAMI FINANCE COMMITTEE

6761 SW 89th Terrace

Miami, Fl 33156


Gentlemen:


As you are aware, I posted a story on my website about the current problems the City of Miami faces over the purchase of 5 year callable bonds yesterday,.


On page 8 of the report prepared by the Finance Committee and recently submitted to the Mayor and members of the City Commission, reference is made to a low level individual within the Finance Department being tasked with making investment decisions on his own after being informed by the then City's Chief Financial Officer "not" to talk with the City's financial advisor, FirstSouthwest Company, and that this led to the City's purchase of these 5 year callable bonds.


While I appreciate the difficulty involved in revealing this information and trying to do so in politically delicate way, I do not think that the report went far enough, or raised and addressed a very significant question that just begs to be asked and answered.


If, Janice Larned, the Chief Financial Officer informed Mr. Wempe, as Mr. Brodsky is quoted as having revealed in the January 2014 minutes of the Finance Committee meeting, not to communicate with FirstSouthwest regarding information and/or recommendations regarding the purchase of bonds, then what role did Mr. Larned play after instructing Mr. Wempe not to contact FirstSouthwest?


Did she provide him with investment advise, suggestions or directions?


It would appear from my own personal knowledge and experience that the possibility of Mr. Wempe, on his own, and without any direction whatsoever making these kinds of financial decisions involving millions of dollars of taxpayer money without at least running them by Ms. Larned for some sort of approval seems far fetched.


In fact, given that in the January minutes of the Finance Committee meeting Mr. Brodsky was able to identify the exact date that Mr. Wempe received this instruction indicates to me that he realized that he was being put in a very precarious position, and that in order to cover his ass, he not only made a record of when he received this order from Mr. Larned, but that he probably kept a record of everything else that occurred afterwards.


It's obvious that this was a very controversial decision, because it appears from the time line offered by Mr. Brodsky on the purchase of these bonds, that the practice ended after Ms. Larned was fired.


So, I think that this needs to be looked into, and here are my public records requests to both of you.  In your case Mr. Feinberg, this is a request to you as the Chairman of the Finance Committee, and it would involve documents received by you and/or any of your members in the course of the investigation that led to the creation of the report you submitted to the Mayor and City Commission.


1.  I want a copy of the purchase orders of all of the bonds purchased by Mr. Wempe from December 15, 2012, until Ms. Larned was fired in mid 2013. I specifically want the information of who the companies were that Mr. Wempe dealt with in the purchase of these bonds.


2.  I want a copy of whatever documentation, if any,  that Mr. Wempe (I am relying on the spelling of this gentleman's name from the minutes of the meeting) provided Mr. Brodsky, Assistant City Attorney Robin Jones-Jackson, or anyone else related to this issue.


3.  I want any emails and or notes between Mr. Feinberg, Mr. Brodsky and Assistant City Attorney Robin Jones-Jackson dealing with the revelations made by Mr. Wempe, including attachments.


Additionally, just out of curiosity does anyone know where either Ms. Larned or Mr. Stephen Petty, the former Finance Director went to work after they were fired from the City? 


I will have other requests once I receive this information, but I want to be able to keep my requests narrow, and focused.


I will look forward to, and expect a timely response to this request because I'm sure that you, like me, want to get to the bottom of this ASAP.


Thank you,


al crespo

How did Janice Larned become the City of Miami’s Chief Financial Officer, and far more importantly, after she demonstrated through her erratic and at times explosive outbursts, as well as her lack of knowledge about subjects that she claimed to be an expert on, why was she allowed to remain?


During Larned’s tenure as the Chief Financial Officer I repeatedly wrote about her unfitness for the job, starting with her hiring Stephen Petty, her business partner’s brother as the City’s Finance Director, even though he lacked the qualifications and even a CPA license.


When Stephen Petty was fired, she should have been fired too for hiring him!  Yet she wasn’t.


On several occasions before December 15, 2012, I was told by sources within the City administration and the Fiance Department that Larned would be fired or forced to resign no later than January 1, 2013.


Yet she wasn’t.


Why?


This is the initial question that any investigation into how the City of Miami ended up with $271,000,000 in 5 year callable bonds needs to have answered.


Since I posted my initial story about this incident last week, I was provided with information that raises the possibility that it was known as early as January/February of 2013 that Larry Wempe, the Finance Department employee who Larned had designated to be solely responsible for purchasing these bonds was concerned about what he was doing, and that this bond buying strategy was a problem.


By summer, it was known within the Finance Department that the City was in real trouble over the unrealized loss created by the drop in value of the bonds purchased by Mr. Wempe.


Yet, it was only when it became abundantly clear that these bonds were a ticking time bomb that Larned was fired.


Again, why?


Somebody(s) made money from the purchase of these bonds.  Who were those persons and how much money did they make?


If Janice Larned told Larry Wempe on December 15, 2012, NOT to seek investment advice or discuss anything having to do with these bond purchases from the City’s Financial Advisor, First Southwest, then what did she tell or instruct him to do?


These are very serious questions, and last Friday I sent a letter to the City Manager and the Chairman of the Finance Committee asking them for information and answers to these questions.


This issue cannot be allowed to be swept under the rug, and this investigation cannot be allowed to be manipulated and/or allowed to linger because the City’s Independent Auditor General has no subpoena power or ability to pursue individuals who refuse to cooperate, as has now happened with the Luis Cabrera/Juan Pascal investigation into the Park’s Department hiring of Cabrera’s half-brother and his wife, months after they arrived from Cuba.


The purchase of $271 million in questionable bonds is not chump change!  This is real money, and a real story that needs to be investigated by an outside  agency that won’t end up screwing the pooch or the taxpayers with a cover up!


Here is a copy of the letter that I wrote last week, which has yet to even be acknowledged.

http://alturl.com/26qb9http://alturl.com/26qb9shapeimage_12_link_0

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