Riley: Raimondo and Mattiello Fiddle While Providence Implodes
Tuesday, May 26, 2015
The facts are clear. Providence falsified an asset of $62 million on the City Books. This was made clear April 28,2015 before the Council Finance Committee by auditor Segal and Co. This was more than 1 year after Segal Co. originally warned the city about unusual accounting. The Taveras administration denied this in public through statements from David Ortiz and Larry Mancini. This asset doesn’t exist and that will be confirmed June 30,2015 when Providence officially can’t pay back its so called “loan” suspiciously obtained from the police and Fire pension plan. Numerous administrations and City councils have been aware that Providence has been misleading the municipal bond market, taxpayers and the beneficiaries themselves. It is also clear that this is a federal issue about to blow wide open. It is extremely unlikely that Providence will survive and receivership is on the horizon.
Remember this?
In 2010 David Cicilline and allies quashed and internal report to the City Council authored by internal auditor James Lombardi. Why?
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTWe all know David Cicilline lied and many of us assume he lied more than once. Mr. Cicilline is very likely associated with the criminal effort to hide the true financial condition of Providence from municipal bond holders and buyers as well as Municipal Ratings Agencies Moody’s and Fitch. Also lied to were taxpayers and citizens of Providence and the beneficiaries of the pension plan that was fleeced of $62 million dollars plus interest that could be an additional $100 million dollars.
Corruption in Rhode Island
Even here in Rhode Island ,easily one of the most corrupt states in the Union, this theft of taxpayer dollars stands out as the largest swindle in Rhode Island History. As we look to our leaders for answers, amazingly, the same guy who was the right hand man for disgraced but lightly indicted Gordon Fox, is oblivious and pushes forward with his priority minor league baseball stadium. House Speaker Nicholas Mattiello is fiddling while Providence burns. Doesn’t he understand the fact that negotiating to obligate Rhode Island Citizens to fund a minor league ballpark in order to help some “ friends” is affected by the fact that Providence is in fact a bankrupt Capital City.
Gina Raimondo ,silent on the issue, perpetuates the cover-up and the “let’s move on” mentality that is so often associated with political corruption. What criminal doesn’t want to “move on”? As of this writing ,there is no direct evidence that Governor Raimondo was in possession of information that Providence was falsifying its financial well being to United States Securities Markets and Regulators. However, it is clear to everyone now that the City has been in violation and I have no doubt that the Governor and Treasurer Magaziner know this as well. The question now is - at what point do these “leaders” work for the truth and for taxpayers? Or have they cynically chosen the well worn path to join the cover-up and corruption which is so imbedded in Rhode Island Politics.
Message to Mattiello and Raimondo
If you want the Rhode Island citizenry to join you in a positive vision for Providence and Rhode Island, first the people need to trust you. Sure 38 studios wasn’t the only embarrassing corrupt disaster in Rhode Island history. But I believe it was the straw that broke the camels back. Mr Mattiello, who is extremely likely to know of criminal activity related to 38 studios, has refused to investigate or use subpoena power. He won’t even talk about it and now he wants to spend another few million of our dollars toward a silencing $12 million dollar tranche. This payoff serves to avoid an almost certain investigation by the insurance company that covered the 38 studios bonds. Meanwhile our ex Governor, now running for President, promised a forensic investigation. He lied. So how about a forensic investigation from our new Governor Raimondo or does that slow down her Political career path?
Back to the Current Criminality
There is ample evidence of fraud and cover-up, and multiple securities laws violations that will likely envelope Providence officials and others. These multiple violations occurred over the years 2000-2015. While I have no information that the SEC is moving in, I have reported my findings to the SEC and others and I wouldn’t be surprised if they are here soon. The time is now, for those who are innocent and truly want to create and maintain an honest Government, to declare themselves.
Most importantly that incudes the Mayor of Providence and Governor Raimondo and the Speaker of the House who should all be deeply aware of the current situation in their capitol city of Providence and cleaning that up should be their priority. Not trolleys and minor league stadiums.
Michael G. Riley is vice chair at Rhode Island Center for Freedom and Prosperity, and is managing member and founder of Coastal Management Group, LLC. Riley has 35 years of experience in the financial industry, having managed divisions of PaineWebber, LETCO, and TD Securities (TD Bank). He has been quoted in Barron’s, Wall Street Transcript, NY Post, and various other print media and also appeared on NBC News, Yahoo TV, and CNBC.
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