By Dan Christensen, Broward Bulldog.org
Months before popular Democrat Robert Wexler abruptly quit Congress last year federal agents interviewed two South Florida businessmen about his campaign’s unconventional $150,000 investment in a real estate venture.
Two sources who also spoke with those agents, including a Republican political opponent whose complaint apparently sparked the inquiry, said authorities were seeking to determine whether the Robert Wexler for Congress campaign had engaged in money laundering. No charges have been filed.
Wexler, a self-described “fire-breathing liberal,” shocked the political world in October 2009 with his unexpected mid-term announcement that he was resigning his politically safe House seat in North Broward and South Palm Beach. Wexler quit to lead a Middle East think tank founded by Slim-Fast founder S. Daniel Abraham. His final day was Jan. 2.
“I’m not under any investigation, my marriage is intact, my health is good and thank God, the health of my family is good,” the seven-term congressman told reporters the day he resigned.
But according to Ken Krefetz, the longtime owner of Miami-based Metropolitan Petroleum Company, agents from the FBI and the IRS came to his office in December 2008 to question him about Wexler and Wexler campaign investment manager, Roy T. Amico.
“They were looking at the real estate transaction that the congressman put campaign money into,” said Krefetz, who provided Broward Bulldog with a copy of an e-mail exchange about the matter between his office and Palm Beach FBI agent Stuart A. Robinson.
He said Robinson and IRS agent Leo Briones characterized the transaction as “highly unusual.”
Robinson declined comment. Briones did not return telephone messages.
Most members of Congress keep their campaign funds in a federally insured bank account. But in recent years election rules have been relaxed to allow campaign money to be placed in stocks, bonds or other investments. An election law attorney in Washington, D.C. said he was not aware of other campaigns investing in real estate.
The FBI contacts Miami oil man
Krefetz said the agents contacted him about a month after he obtained a $455,000 judgment against Amico for allegedly cheating him in the purchase of a Vero Beach gas station.
“I don’t know Wexler. It was a bolt for me, but I thought it was a lucky bolt that these guys were interested in Amico. … It’s a gift if you can get the feds to the do the heavy lifting for you,” he said.
Krefetz said the agents were mostly interested in a deal he knew nothing about: a $150,000 second mortgage the Wexler campaign held on a million dollar waterfront home owned by Amico and his brother, Armand, on South Flagler Drive in West Palm Beach.
Records show the campaign obtained the mortgage in 2004, and after it was apparently repaid, got a fresh one in 2006. The campaign did not record the 2006 mortgage with the Palm Beach County Clerk’s office for more than two years.
Palm Beach businessman David Cohen, the former president of Petroleum Consolidators of America (a publicly traded company now known as CTX Virtual Technologies), says federal agents interviewed him about Wexler and Amico around the same time they talked to Krefetz.
“They wanted to know how I knew Roy, that sort of thing,” said Cohen, whose Petroleum Consolidators sued Amico in April 2008 for breach of contract and fraud in the same soured deal as Krefetz. The lawsuit was closed last month after Cohen decided to drop it.
Cohen was not contacted again, but another source with detailed knowledge of what happened said agents spoke with him more than once over a period of five months in 2008-2009. It is not known whether the inquiry was concluded without charges, or continues through today.
Wexler, president of the Washington-based Center for Middle East Peace, declined comment through a spokesman. He remains active in politics and traveled to South Florida in September to campaign for his friend, Gov. Charlie Crist’s failed independent bid for a U.S. Senate seat.
In December, Wexler’s ex-chief of staff Eric Johnson told Broward Bulldog the campaign took back the mortgage and a promissory note from the Amicos in January 2004 to secure its $150,000 investment in the now defunct Capital Gains Real Estate Consultants.
Capital Gains never held title to the home, but its biggest shareholder and president was Roy Amico. His partners were Palm Beach political consultant Tom Plante, who once worked for Wexler, and Armand Amico.
The campaign did not report the mortgage transaction on its disclosure reports to the Federal Election Commission, whose rules require campaigns to report both disbursements and owing “debts and obligations.”
Wexler campaign taxes a big loss
Today, the $150,000 – money supplied by contributors to Wexler’s campaign – is a total loss, according to those involved.
Roy Amico said last week that he was aware of the FBI-IRS inquiry, but declined to say whether agents had questioned him.
“I’d really rather not comment on that,” he said. “They are making a big deal out of this thing when (Wexler) didn’t really do anything. There was no impropriety whatsoever.”
Amico is a former stock broker who for many years helped Wexler’s campaign manage its investments. Robert Wexler for Congress became his client in the 1990s when he worked for the now shuttered brokerage firm Joseph Charles and Associates. The firm, and the campaign, had offices in the same building at 2500 N. Military Trail in Boca Raton.
He explained that he and his brother purchased the home on Flagler Drive for $975,000 in January 2004 with the intention of flipping it to another buyer. Amico said the Wexler campaign received a 6.5 percent interest rate for the loan to remodel the house.
“They had all this money sitting around and earning no money in the bank so now they got 6.5 percent,” Amico said. “It may be unusual, but everyone was making money in real estate.”
Amico had the right connections to the campaign. In addition to personally knowing Wexler, Amico’s ex-girlfriend of eight years was Daniella Alonzo Howard, the congressman’s aide.
“I had the trust. The campaign was a client of mine for years,” said Amico. “I talked to Daniella and she got Eric. And I talked to, I guess, Wexler a couple of times.”
A pair of damaging hurricanes and the meltdown of Florida’s real estate market combined to sink the financial plans. The home is now in foreclosure.
“Suffice it to say I lost a lot of money, too,” said Amico, who filed for Chapter 7 bankruptcy protection this year but was denied a discharge for a technical reason.
But Capital Gain’s principals and the Wexler campaign weren’t the only ones who lost big money on the deal.
Amico and Capital Gains told to pay
Three weeks ago, Palm Beach Circuit Judge Robin Rosenberg ruled that Amico and Capital Gains defrauded $330,000 from one of Amico’s former clients, elderly Chicago resident William Reczek. Amico and Capital Gains were ordered to pay Reczek $454,000 in damages.
Reczek’s lawyer, Kenneth Johnson of Palm Beach Gardens, sued in 2008 claiming his client was duped to “invest” in Capital Gains by Amico’s bogus promise to deliver a mortgage on the Flagler Drive home. In fact Amico could not deliver on such a promise because Capital Gains never owned the property and after May 11, 2005, neither did he because he had transferred his interest to his brother Armand, the lawsuit said.
Amico did not defend the case, but called Reczek’s accusation “totally unfounded.”
The Wexler campaign never sought to attempt to reclaim its $150,000 investment via litigation against Amico. Rather, last year it voluntarily released the mortgage it held as collateral after the property fell into bank foreclosure.
Roy Amico was involved in another controversy involving the Wexler campaign regarding his work at Fort Lauderdale’s Newbridge Securities – a company co-owned by another brother, Guy Amico.
In July 2008, the campaign amended 25 FEC disclosure reports dating to 2001 that it said had improperly reported Newbridge as the source of investment income or loss. Amico was a broker there in 2000-2002, and campaign officials later said the amendments were made to properly identify the firms Amico was affiliated with after he departed Newbridge.
The FBI-IRS inquiry was apparently touched off by a complaint to the FBI by Ed Lynch, a Republican foe who lost to Wexler in 2008 and this year ran unsuccessfully against Democrat Ted Deutch.
Lynch said he became suspicious in early 2008 after reviewing election records that showed thousands of dollars in payments to the Wexler campaign from companies associated with Roy Amico, including Capital Gains, and Newbridge.
“My campaign manager went with me to the FBI,” said Lynch.
Lynch later sought to exploit the FBI’s interest with the news media in mid-campaign, but was largely ignored absent independent verification of the bureau’s interest.