Miami Beach

Miami Beach police charity facing scrutiny -- again

It's a holiday tradition in Miami Beach for more than 30 years: The Police Athletic League uses its tax-deductible dollars to buy turkeys, veggies and canned goods that members pack into baskets and distribute to poor families before Thanksgiving.

But a couple of years ago, PAL also popped for 24 fatter birds, weighing 16 to 24 pounds, six eight- to 10- pound turkey breasts, seven racks of lamb, 14 pounds of skirt steaks, 15 pounds of flank steaks, nine pounds of ground Angus, two packages of smoked salmon with cracked pepper, 22 pork tenderloins and six boxes of shrimp.

That feast, however, didn't go to the poor. Most of the $1,000 bounty ended up on the tables of PAL board members, city employees and Miami Beach police officers, according to a city audit.

The Miami Beach Police Athletic League has a history, city auditors and police internal affairs investigators say, of sloppy accounting and questionable business deals and using the nonprofit's coffers for the benefit of the police administration, police officers and their friends.

Examples of PAL's expenditures include a $27,000 whitewater rafting trip in Idaho; $2,400 for personal expenses such as airfare for family and friends; $4,500 per year for cellphones; $3,600 for 10 Glock 9mm guns; and $23,000 paid to a retired Miami Beach police officer for DNA-fingerprinting kits. During the past three years, corporate credit card receipts also show that Miami Beach's PAL spent thousands of dollars on dinners at pricey restaurants such as Joe's Stone Crab.

Current PAL officials say the purchases all benefited kids in keeping with the organization's mission, and probes by the police department's own Internal Affairs and the state attorney's office dismissed allegations of wrongdoing as merely poor bookkeeping and lax oversight of organizational by-laws.

However, Jorge Gonzalez, Miami Beach city manager, has requested another probe to determine whether PAL's money went into private pockets.

"If there were matters of a criminal nature ... then the state attorney's office needs to handle that, " said Gonzalez, who insists the city probes have been thorough. "We did what we thought we could do."

The Miami-Dade state attorney's office said it is considering the request.

APPLYING PRESSURE

Steve "Bubba" Cohen, a former PAL vice president, has been relentlessly pressuring public officials to investigate. He joined PAL when he was 8 years old, and has been an active supporter, serving as a volunteer and in various leadership and board capacities for most of his life.

Cohen, now 60, resigned from PAL in disgust in 2009, along with eight other board members, after they learned that the head of the agency, retired Miami Beach police Officer Bernard Winer, had used his corporate credit card for personal expenses and had made large-scale purchases without the board's approval. PAL records show that in some cases, the purchases were for - or from - friends, family and other police officers. Winer, who ran PAL for more than a decade, declined to comment for this story, citing the possible investigation.

About a week after Gonzalez contacted the office of State Attorney Katherine Fernandez Rundle, Cohen's attorney, Abe Laeser, a well-regarded retired Miami-Dade criminal prosecutor, wrote a letter to his former boss. He implored Rundle to ensure that a second investigation into whether PAL money was misused be more aggressive than the first, calling the police department's Internal Affairs probe "a laughable joke."

Miami Beach's PAL, the oldest in the state, receives taxpayer dollars, grants and donations that are supposed to be used to forge positive relations between youth and police officers and to fight juvenile delinquency through academics, sports and the arts.

Buttwo city audits, conducted in 2006 and 2009, found:

PAL misspent thousands of dollars per year on wedding gifts, Costco memberships for police officers and their wives, food for funerals, flowers, and dinners for board members and other PAL acquaintances. One example: a $2,179 tab at Monty's Stone Crab and Seafood House.

PAL made tax-exempt purchases on behalf of two taxable organizations, thereby helping them circumvent thousands of dollars in taxes. In one instance, NeoStar Sports & Entertainment avoided paying $36,000 in sales and resort taxes on two lavish, $400,000 Super Bowl parties at Nikki Beach and Pearl by using PAL's certificate of exemption.

PAL, which runs a gym, received the bulk of its revenue - $189,000 - in 2010 from memberships, which are largely paid in cash. A full-time gym manager was fired in 2009 for throwing out receipts and pocketing the money. While PAL said only $500 was missing, auditors found that an average of seven receipts was missing from each of the 18 receipt books they examined.

The organization has spent tens of thousands of dollars on police appreciation events, police retirement dinners, tables at the Law Enforcement Officer Awards, alcohol permits for police-sponsored events and parking tickets received by PAL volunteers.

Auditors questioned PAL's relationship with Miami Beach's police chief, pointing out that 12 expenditures totaling almost $14,000 were made "at the request of and for the direct benefit" of the chief. Items purchased included shirts, mugs and duffle bags, contest prizes, holiday presents for police officers and bicycles for police officers. PAL also bought 10 Glocks, costing $3,600, to be used in its teen Explorers program, though the guns ended up with the police department.

PAL President Robert Jenkins, who took the helm after the audits were complete, said that PAL has implemented most of the recommendations made by the auditors.

"If you spend any money it should be approved, '' Jenkins said, adding that he still does not know the reason PAL purchased $1,000 worth of expensive cuts of meat in connection to one of its Thanksgiving turkey giveaways.

He declined to comment on any of the other allegations contained in the auditors' or Internal Affairs reports. "It's inappropriate for me to say anything since it is under investigation by the state attorney, '' he said.

PAL did not respond to The Miami Herald's request for financial documents, has retained an attorney and disputes whether the organization, which receives public dollars, is subject to the state's public records law.

PRIMARY FUNDRAISER

Between 2006 and 2009, PAL received $331,000 in public money - mostly through a surcharge the city collects from businesses that hire off-duty police officers. The city also pays the salary of PAL's executive director, which in 2010 was about $72,500 a year.

As of September 2010, PAL was sitting on $847,000 in cash and assets. According to its 2010 tax return, PAL received more than $2 million in donations, grants and other public support during the past five years. It also earns about $200,000 per year selling community memberships to a for-profit, private gym the organization runs at its headquarters at 999 11th St.

Tax records show that of the $446,000 in revenue it collected in 2010, PAL spent $120,000 on youth programs.

As PAL's primary fundraiser, Winer had entry into some of Miami Beach's most powerful social and political circles and wielded considerable power with members of the City Commission and police chiefs. He also raised money for the organization. In 2010, tax records show PAL received $218,000 in contributions and grants. Winer's supporters argue that he was instrumental in raising those dollars.

But after running PAL largely without scrutiny for a decade, Winer was suspended in July 2009. His suspension came after he asked for a raise and several board members opposed to the raise looked at his expenses.

According to the minutes of the meeting, what they found in the financial records alarmed them: He had made tax-exempt personal purchases on his corporate card; he had paid for an unusual number of lunches, dinners, gifts and alcoholic beverages, and had his AOL account and cellphone bill paid out of his tax-free corporate account, credit card records show.

They also learned that Winer and his grandson had gone on a $27,000 PAL-sponsored whitewater rafting trip in Idaho in 2008. Nine children, as well as PAL's executive director, Harry Morgan, also went on the trip, which was mostly paid for by a wealthy donor, Mark Pickard, who did not return phone calls from The Miami Herald.

Winer told the board that Pickard specifically asked that his PAL donation be spent on the trip and later, he told them that Pickard had picked up the tab for his grandson. But the board didn't authorize the trip and had misgivings about spending such a large sum on such a lavish trip.

"That $27,000 for those nine kids was five times the budget for any of the programs that we did that service 200 kids, '' PAL's then-president, Gregg Francis, would later tell police internal affairs investigators.

A chief financial officer by profession, Francis hired an attorney to represent PAL after the board saw Winer's expenses and began delving into other financial records.

Soon after, Francis was asked by the executive board to resign and the lawyer he had hired, who had offered some of his services for free, was terminated by a vote of the full board, which included retired and current police officers.

Francis later told internal affairs investigators that a PAL member threatened his CFO job at Mangos Tropical Cafe, an Ocean Drive nightclub whose owner, David Wallack, sits on the PAL board and employs off-duty Beach officers.

"Gregg better shut the F up, '' the PAL member told his boss at the club, Francis testified under oath. Francis later lost his job, but Wallack said he was never contacted by anyone from PAL, and that Francis was dismissed for reasons that had "absolutely nothing" to do with the organization. Francis did not return several calls to comment for this story.

Winer, who was also a member of the executive board, was allowed to resign voluntarily, with board members agreeing that his long service to the organization earned him his full salary for the rest of the year.

Shortly thereafter, nine board members, including Cohen, resigned. Other executive board members who resigned were its treasurer, William Riley, then a division chief with the department; its secretary, Maria Cruz, who is a teacher; past PAL President Lynda Veski, a retired Miami Beach police captain; and her son, Michael Veski, who is also a Beach cop.

Lynda Veski, the force behind the Kindergarten Cops program, which introduced young people to Miami Beach police officers, told board members that the 50-year-old organization's future was threatened by people who had "personal and financial agendas" not in keeping with PAL's mission to help disadvantaged children.

Veski, who declined comment for this story, said in her resignation letter that Cohen, Francis and Cruz were all threatened by PAL members who rejected the notion that the agency needed to be cleaned up.

Cohen took the allegations to the Miami-Dade Commission on Ethics and Public Trust, which spoke to two Miami Beach police lieutenants. The commission then referred him to the very agency he believed was behind the improprieties: The Miami Beach Police Department.

Chief Carlos Noriega, who is no longer running the department, launched an internal affairs investigation, which was conducted in conjunction with a city audit later that year. While both concluded that Miami Beach's PAL was a bookkeeping nightmare, they found no evidence of criminal wrongdoing. They referred their findings to the state attorney's public corruption unit, which agreed.

During the police probe, Francis told investigators that he believed that tens of thousands of dollars were spent on programs run by police officers and their friends, including money that was spent on a Thanksgiving turkey deep-fry - all without the approval of PAL's executive board.

Especially troubling to Cohen, Veski and other board members was an unauthorized expenditure of $23,000 for DNA LifePrint Kits for kindergarten, first- and second-grade school children. Veski and others voiced concern over spending such a large sum for a program. She and auditors were skeptical whether it should be funded by an agency whose mission was to keep kids on the straight and narrow.

Auditors noted that PAL paid $20 per kit, about $6 per-kit more than the company advertised on its website. The company is owned by retired Miami Beach police Officer Joe Matthews, a friend of Winer's. Winer told board members that like the whitewater rafting trip, the tab for the program was picked up by Pickard, who specifically asked that the money be used for DNA testing.

Matthews, a 30-year-vet- eran homicide investigator, said he has been providing the kits - along with other child-safety products - to Miami Beach schoolchildren for the past 16 years. He said the program is nationally recognized and has been sponsored through Miami Beach's PAL for many years without controversy. If anything, he said, he has received nothing but praise and commendations from the city for the program, which provides parents with a package that includes a DNA test, a CD with the child's computer-scanned bio-metric fingerprint, the child's photo and a child-safety journal. He says the total package costs him $30 to $35 a piece, which he sells to PAL at a reduced rate. He said he also donates hundreds of other kits throughout the year at no cost.

Matthews, who independently investigated the Adam Walsh homicide, said that had he had these tools over 20 years ago, it would have helped solve the case, which was closed in 2008 and blamed on a dead convict.

"I've provided these kits to PALs across the country, '' Matthews said. "The adverse children are the very kids who, God forbid, often go missing, '' he said.

IMPORTANT MISSION

Michael Dillhyon, executive director for the National Police Athletic League, said PAL's most important mission is to build relationships with young people - and the best way to do that is for police officers to work directly with youth, whether through sports, mentoring or other programs. Studies show that the hours kids are most likely to get into trouble are between 3 and 8 p.m., when their parents are working. For that reason, PALs across the nation offer sports and other activities after school and in the early evenings.

The Broward Sheriff's Department's PAL program, for example, runs 15 different sports activities, including golf, baseball, cheerleading, soccer, karate and wrestling. The Deerfield Beach PAL gym is filled in the early evenings, when it runs a successful boxing program for kids, some of whom say without the program, they might be out getting into trouble.

Art Martineau, current executive director of Miami Beach's PAL, said the agency serves about 100 kids on an ongoing basis. It offers a mentoring program on Saturday afternoons and a police Explorers program meets at the Miami Beach police station two evenings a week. The organization sponsors a lacrosse program, but he wasn't certain when the team practices.

Martineau, who was hired after Winer left, said most of the programming PAL sponsors involves donating money to schools, Boy Scout troops and funding for band uniforms and back-to-school backpacks. Its biggest event is the Thanksgiving turkey giveaway.

Its gym, dedicated in 1980, is not used for PAL programs. A plaque outside the gym reads: "Our kids are our wealth and future of Miami Beach. Let's keep them healthy, mentally alert and physically fit.''

But three decades later, the PAL gym is run as a private, for-profit business, Martineau said. Membership fees cost nearly $500 a year, plus a one-time fee to join of $150, PAL's website says. High schoolers are allowed to use the gym only before 5:30 p.m. and must pay $180 a year, according to the website.

Martineau could not say how many young people use the gym, but board members say the gym is not conducive to the kids that PAL serves. In 2009, members of PAL's executive board learned that Winer had hired a former porn actor to run the gym. The building also houses a city-run after-school programs for young children.

Dillhyon, the national executive director, declined to comment on Miami Beach's PAL. Winer is a member of the national PAL's executive board though his term is coming to an end and he is not expected to run again, Dillhyon said.

Channeling money to other causes that benefit children, while worthwhile, doesn't accomplish what most PALs strive to do, Dillhyon said.

"PAL is a safe haven for kids, a supervised atmosphere where kids can enjoy themselves and the law enforcement officers help build relationships with kids, many of whom see police in a negative way, '' Dillhyon added.

When Dillhyon was director of the local PAL in St. Augustine and a police officer there, his fellow cops used to joke about the time he went to put a suspect in the back of his patrol car and a basketball rolled out and bounced down the street.

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