New questions arise over Democrat’s financial disclosure

A $9,000 payment to a campaign vendor does not appear on former Democratic candidate Justin Lamar Sternad’s amended campaign finance report.

08/29/2012 5:00 AM

08/29/2012 11:24 PM

As the FBI began investigating a failed Democratic congressional candidate tied to Republican Rep. David Rivera, the campaign amended its financial disclosures in an effort to clear up lingering questions about its book-keeping.

But instead, the revised disclosures — coupled with contradicting statements by Rivera who told a Miami blogger of some involvement in the Democrat’s campaign — raises more questions for a federal grand jury about the campaign of Justin Lamar Sternad.

At issue: payments to Expert Printing, a Doral company tied to Rivera that could have produced at least 135,000 mailers for Sternad’s campaign. Many of the mailers were sent out by a mail house paid in cash — sometimes in envelopes stuffed with crisp $100 bills.

Total cost to send the mailers out: Nearly $47,000.

Total cost to print the mailers: at least $33,000 and as much as $50,000, according to printers and political consultants from both parties not associated with the Sternad campaign.

Yet Sternad’s campaign finance reports only list a $6,000 expenditure to Expert Printing, the only printing company in his disclosures, which Sternad only acknowledged in his amended reports received by the Federal Election Commission on Aug. 21.

But the reports give no indication about how he actually afforded to pay for the mailers. What’s more, Expert Printing in turn paid $9,000 on behalf of Sternad to another vendor, Rapid Mail & Computer Services, to label the mailers and send them out, Sternad’s new reports show.

How and why Expert Printing paid Rapid Mail $3,000 more than it was paid by Sternad is unclear.

Enrique “Henry” Barrios, vice-president of Expert Printing, did not return calls or text messages for comment. Sternad won’t comment, as did his lawyer, Rick Yabor.

The FBI and Miami-Dade police launched a criminal investigation after The Herald first reported that the Sternad campaign had paid for the mailings in cash. The case is now before a federal grand jury.

Sternad’s campaign ended Aug. 14 when he lost the primary election against Democrat Joe Garcia, a Rivera rival who was savaged by a Sternad flier and who now faces Rivera in the general election in November.

Under federal campaign finance laws, it is illegal for federal candidates to knowingly and willfully file false paperwork. They also can only accept a maximum of $2,500 from contributors — including in-kind services such as complimentary printing or mail services.

“The point of campaign-finance laws is pretty simple,” said Ron Meyer, a campaign-finance expert and attorney in Tallahassee.

“The public has a right to know who’s giving what to a candidate for the sake of transparency,” Meyer said. “When the numbers don’t add up and when cash is involved, it raises a lot of red flags and legal questions.”

The FBI is now investigating the incident on behalf of a federal grand jury.

Rivera already faced a federal investigation for his involvement in a $500,000 secret payment from a dog-track that, along with other parimutuels, persuaded voters to allow Las Vegas-style slot machine gaming in Miami-Dade in 2008.

Rivera initially denied any involvement in or knowledge about Sternad’s campaign. But last week, Rivera told Miami-based blogger Nelson Horta that he knew his friend, Ana Alliegro, was working as a campaign manager for Sternad.

"I have never talked, nor seen the other candidate, only Ana Alliegro contacted me, who ran the campaign of the other candidate and asked me for help as to a mailing,” Rivera told the blogger.

Rivera and Alliegro are close friends. Her Facebook page shows the two of them frequently mugging with each other for the camera.

A third vendor involved in the Sternad campaign, Hugh Cochran, of Campaign Data, previously said Rivera approached him to perform data analysis to target the right voters with the nearly dozen mailers sent out by Sternad’s campaign.

After Cochran showed The Herald an email he sent to Rapid Mail and Rivera concerning the data targeting for Sternad, Rivera said he was “mistakenly” copied.

But his interview with the blogger, showed why Cochran might have “mistakenly” included Rivera.

“I recommended Hugh Cochran; I called and said a friend of mine was going to call, that was it," Rivera told “Nelson Horta Reporta”

Cochran told the Herald earlier this month that Alliegro only called him after the Aug. 14 election for the congressional seat that stretches from Kendall to Key West.

“I don’t know why she called, her candidate already lost,” said Cochran, a retired FBI agent.

Rivera has also personally attacked Herald reporters as being de-facto extensions of Garcia’s campaign, which first raised questions about Sternad’s involvement with Rivera. Rivera has also questioned the integrity of Cochran and Rapid Mail’s owner, John Borrero.

Borrero said two weeks ago that the Sternad campaign had paid for the mailings in cash. Borrero, known as a high-quality and low-cost mail-service specialist, has a solid reputation in political circles and is not under investigation as he cooperates with the FBI over the cash payments.

Sources familiar with the transactions said the cash arrived at Rapid Mail via courier or was delivered by Alliegro. A separate bundle of cash — $7,800 — appeared in the mailbox outside Rapid Mail, which the sources said was directed by Rivera. Alliegro denies paying cash.

A political newcomer with no political experience, Sternad earned about $30,000 working for two hotels, his financial records show. He did not list any income from his wife. The couple has five children.

Sternad did list some savings, a mutual fund he inherited that’s valued at a maximum of $100,000. His disclosures show he has a one-third interest in the fund and that he derived no income from it this year or the previous year.

Sternad has had financial problems in the past, declaring bankruptcy in 1997. More recently, Capital One Bank won a default judgment against Sternad’s wife for $1,746.48 on Jan. 11, records show. There is no record that the judgment has been satisfied.

Sternad initially said he only loaned his campaign about $11,000. But after repeated questions from The Herald and the launch of the federal probe, Sternad amended his reports last week to show he loaned himself $52,973.10 during the pre-primary reporting period that ended July 25.

That huge sum accounted for the expenses he listed for Rapid Mail and Expert Printing, which hadn’t been disclosed previously despite Sternad’s claims that his financial disclosures were in order.

Sternad showed he closed the pre-primary period with $120.97 in the bank. But on Aug. 9, Expert Printing’s parent company, Inkpressions Inc., paid Rapid Mail with a $9,000 check.

The source of funds is unclear. If Sternad received any contribution or loaned himself anymore money over $1,000, he would have had to report it within 48 hours between July 25 and the Aug. 14 primary.

Sternad filed no such reports.

The renewed federal investigation connected to Rivera has started buzzing around the Florida delegation at the Republican National Convention in Tampa, where Rivera’s close friend, Sen. Marco Rubio, is supposed to introduce Republican Mitt Romney on Thursday in primetime. The two former state lawmakers still own a house they shared while serving in the Legislature in Tallahassee.

“I only know what I’ve read in the press. I haven’t had a chance to speak with him since that all came out,” Rubio said. “I just hope none of it is true. I continue to give him the benefit of the doubt on all these things. I just hope none of it is true.”

Rubio said he hasn’t spoken to Rivera. “I’ve been really busy the last 10 days. I was on vacation and then I’ve been here. I’m not sure he’s here,” he said.

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