Wednesday, April 18, 2012

Espada’s $256K from ‘vacation’ hours


Last Updated: 1:48 AM, April 18, 2012

Posted: 1:23 AM, April 18, 2012

Why didn’t he just take the whole year off?

Pedro Espada Jr. collected a staggering $256,195 payout for accrued “unused vacation time” — equivalent to 2,160 paid hours — an official from the ex-state senator’s taxpayer-funded Bronx nonprofit testified yesterday at his embezzlement trial.

Espada took the massive charge-off — equal to getting paid for 54 weeks of full-time work — so that he could reimburse his Soundview Health Care Network for “personal expenses” racked up on the charity’s corporate American Express card, the nonprofit’s chief financial officer, Philip Valdez, testified.

Thomas E. Gaston
Pedro Espada Jr.

Even with the $256,000 payout, Espada was $30,000 short for personal expenses he admitted owing the company, Valdez said in Brooklyn federal court.

So on Jan. 1, 2009, Soundview granted Espada his full, annual eight weeks of vacation — without him having to accrue it over that year — so he could take another payout against vacation time and cover the shortfall, Valdez said.

That was in addition to the astounding six weeks that Espada received annually in sick time from Soundview, whose stated mission is to provide poor Bronx residents with decent health care.

Valdez said Soundview repeatedly had to amend Espada’s W-2 forms — which reported his compensation to the IRS — because the charity had failed to include the vacation-time charge-offs and other perks he received, including a $30,000 annual “housing allowance,” insurance for a Mercedes-Benz and life insurance.

Espada’s 2007 W-2 was adjusted from a hefty $459,000 in reported compensation to an astounding $671,000, Valdez said. Espada’s 2008 W-2 had to be corrected from $300,000 to $596,000.

Even after this payroll rigmarole, prosecutors allege, Espada illegally claimed that a slew of personal expenses charged on the AmEx card were business-related.

One purchase in March 2008 was for $2,000 worth of sporting-event tickets at Madison Square Garden, which Espada claimed was a “staff outing,” a handwritten note showed.

Espada also claimed that dozens of charges for meals at restaurants in the Westchester town of Mamaroneck — where he lived — were business-related.

Espada’s AmEx bill, which routinely ran between $21,000 and $100,000 a month, was always paid in full by Soundview, even when the charity couldn’t afford to pay other bills, Valdez said.

One month, he said, Soundview’s alarm system was “canceled because of nonpayment.”

Espada himself was responsible for marking purchases he claimed were “personal” on the AmEx bill — all others were treated as business expenses by Soundview, Valdez said.

“If he didn’t mark it as personal, who am I to decide?” Valdez said.

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