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December 6, 2011
Feds open SEC probe into Miami Marlins stadium deal
The U.S. Securities & Exchange Commission has subpoenaed records from Miami-Dade County and Miami over the deal to build a new ballpark for the Marlins.
Miami Herald
by Charles Rabin, Martha Brannigan and Patricia Mazzei
Look who's just catching on!
Federal authorities have opened a wide-ranging investigation into the Miami Marlins’ controversial ballpark deal with Miami-Dade County and the city of Miami, demanding financial information underpinning nearly $500 million in bond sales as well as records of campaign contributions from the Marlins to local and state elected leaders.
In a pair of lengthy letters delivered to government attorneys Thursday, the U.S. Securities & Exchange Commission gave the city and county until Jan. 6 to deliver everything from minutes of meetings between government leaders and Marlins owner Jeffrey Loria and Major League Baseball Commissioner Bud Selig, to records of Marlins finances dating back to 2007.
In the almost-identical subpoenas, the SEC also requested documents concerning stadium parking garages built by Miami. The Miami Herald reported Nov. 22 that city leaders are now complaining they were hoodwinked into likely having to pay an annual $2 million tax bill on the garages.
The financing agreement to build the controversial new stadium in Little Havana left the county and city on the hook for almost 80 percent of the overall $634 million tab, which critics considered a giveaway to the Marlins. The deal was a contributing factor in the recall of Miami-Dade Mayor Carlos Alvarez, who championed it.
...Neither subpoena said exactly what the SEC was looking for, though federal investigations into municipalities generally focus on whether bond holders were misled about finances while being enticed to purchase the bonds.
Two former SEC attorneys who reviewed the subpoenas for The Herald said government investigators are likely looking at whether the city and county did proper due diligence into the Marlins’ finances, and whether there was any influence peddling to local politicians.
“There’s always the issue of pay-to-play. They want to know whether there were unlawful contributions,” said William Nortman, a Fort Lauderdale attorney and former SEC regional administrator. “Don’t forget, there was a lot of controversy over the building of this in Miami. They are examining how this came to be. They want to know whether inappropriate payments were made.”
NoLandGrab: Hey, SEC, you might want to look into another recent deal in which approximately $500 million of bonds were sold to fund construction of a basketball arena.
Posted by eric at December 6, 2011 1:25 PM