January 13, 2010 11:12 AM
By Elizabeth Benjamin
Portions of a potential legal case against Espada were outlined this morning in a bombshell filing Cuomo's office made in Manhattan Supreme Court that asked a judge to compel Espada to cooperate with a subpoena.
In the papers, Cuomo's office charged that Espada has not complied with a subpoena issued Aug. 25 to a management company he created and entirely controls, Soundview Management Enterprises.
(This is not to be confused with the subpoena served by Cuomo on the Senate last week that sought information about Espada's member items as well as his financial disclosure forms, text messages and cell phone records).
The for-profit company was created in late 2007 and hired early the next year for $33,000 a month to provide janitorial services to Soundview HealthCare Network, which Espada also created and serves as its president and CEO.
According to the papers, which appear in full after the jump, Cuomo’s office has been investigating Soundview's parent company, Comprehensive Community Development Corp. for nine months.
Cuomo’s office says it has found “extensive evidence of potential violations” of the state not-for-profit corporation law by Soundview Healthcare and a number of its officers, including Espada, who is its president and CEO.
The contract between the senator's health care network and the management company "allowed Mr. Espada to effectively siphon off and otherwise divert money from Soundview (health centers) for Mr. Espada’s own personal and political benefit,” the papers say.
Documents obtained by Cuomo’s office show that “significant portions” of the funds paid by Soundview to the management company went toward paying Espada’s campaign expenses.
Such expenses included printing, campaign office rent, and personnel costs.
The papers allege that Soundview, either directly or indirectly, through Espada’s management company paid expenses related to the senator’s campaign and paid workers who were dispatched to work on the campaign - all in direct violation of not-for-profit laws.
The contract between Soundview and Espada’s management company is also “improper,” Cuomo’s office alleges.
Espada’s management company was paid $400,000 per year to provide maintenance services to Sound view even though board minutes show no valid reason for the awarding of the contract, according to the court filing.
Before the contract was awarded, maintenance services were provided by Soundview itself.
Further, Cuomo’s office is investigating potential labor law violations at Espada’s management company, including a scheme to boost company profits at the expense of the employees.
Possible tax liability issues concerning Espada and his companies are also part of the probe, according to the paperwork.
Read more: http://www.nydailynews.com/blogs/dailypolitics/2010/01/cuomo-has-extensive-evidence-o.html#ixzz0cW9wMRxx