By Michael E. Miller
By Allie Conti
By David Villano
By Jose D. Duran
By Michael E. Miller
By Allie Conti
By Kyle Swenson
By Luther Campbell
Here's a riddle.
Why is the criminal investigation of a little-known Broward-based insurance company by the statewide prosecutor in Tallahassee causing so much anxiety in the offices of Dade County Mayor Alex Penelas?
One reason: The target of the investigation, David Sanz, was a significant contributor to Penelas's 1996 mayoral campaign. Campaign finance reports reveal that Sanz, through various companies, funneled $6000 to Penelas's coffers -- a tidy sum considering that Sanz has never met Penelas, does no business in Dade County, and couldn't have cared less who won the election. A reasonable person might question why he made those contributions.
And therein lies the concern, because Sanz is now alleging that Penelas's chief of staff, Brian May, solicited contributions to the mayor's campaign while serving as deputy chief of staff to Florida Insurance Commissioner Bill Nelson.
Sanz owns Gulf Atlantic Management Group, a company that managed a private workers' compensation fund known by the acronym FESA (Florida Employers Safety Association). In the late Eighties and early Nineties, FESA provided workers' comp coverage for 3400 self-insured businesses with nearly 60,000 employees.
In 1996, however, the FESA fund ran into financial trouble; fund officials projected losses of more than seven million dollars. Throughout the spring and summer of that year, Sanz tried to negotiate a recovery strategy, known as an assessment plan, with the state Department of Insurance.
At the time, May was pulling double duty -- running Penelas's mayoral campaign and working for Nelson in Tallahassee. For appearance's sake, May took an unpaid leave of absence from the insurance commissioner's office during the last few months of the campaign, although he maintained his title as deputy chief of staff as well as his Tallahassee office.
Two months ago Sanz's Miami attorney, Richard Sharpstein, informed the statewide prosecutor investigating his client that in 1996 Brian May solicited campaign contributions from Sanz. In return, May allegedly promised that he would speed along Sanz's recovery plan and thereby keep his business alive. (The independent statewide prosecutor's office specializes in complex fraud cases that cross county lines.)
David Sutton, the assistant statewide prosecutor who is reviewing the allegations that Sanz misappropriated $3.5 million from FESA, acknowledges that Sharpstein has accused May of wrongdoing. "The allegations against Brian May are obviously something that are going to have to be dealt with," Sutton confirms. He passed along the accusations to his superiors and says it's up to them to decide how to proceed. "An investigation will be done by the appropriate agency at the appropriate time," Sutton adds. "Nobody is going to try to not have it investigated."
May denies asking Sanz to donate to the Penelas campaign. "This is a lot of political mudslinging," he contends. "I'm an easy target for this stuff." Nelson is up for re-election this year, May notes, and Sanz is supporting his opponent, former state representative Tim Ireland. "One way to get at Nelson is to come at me," he argues.
May believes Sanz is fabricating these allegations and threatening to embarrass as many people as possible in a desperate attempt to avoid prosecution if he is indicted. Don Pride, communications director for the Department of Insurance, agrees, asserting that Sanz's allegations are "an obvious ploy to get Bill Nelson to back off so Mr. Sanz can escape from his very serious legal problems."
During my initial interview with Sanz last month, he described his alleged conversation with May. "I got a phone call one afternoon," the 37-year-old businessman recalled, "and it was Brian on the phone and I said, 'Brian, what's going on?' And he said, 'Well, Dave, I heard you're having some difficulties getting your assessment plan approved.'
"And I said, 'You know, Brian, I really am. I just don't understand you people. It's like gridlock in your office. I can't get a yes, I can't get a no. I can't get an answer to any questions.'
"He said, 'Well, Dave, you know how things are. But I'll look into it for you.' And then he said, 'Well, look, the reason I'm calling is I'm raising some money for Alex Penelas.' He said, 'I'm trying to raise some money, and the insurance commissioner and I would consider it a personal favor if you could raise, let's say, $20,000, $25,000 for us.'
"And I said, 'You know, Brian, things are a little rough right now.' And he said, 'Well, I think if you could raise, let's say, $20,000 for Alex Penelas, I think we can get this plan moving for you.'"
Sanz did not remember the exact date of the call. Attorney Sharpstein, trying to piece together a chronology, believes May's call came after Sanz had already donated $6000 to Penelas's campaign. Sharpstein says Sanz made that donation at the urging of one of his Tallahassee lobbyists, Fred Baggett, an attorney with the Miami firm Greenberg Traurig.
Sharpstein claims the law firm squeezed its clients for Penelas in a transparent attempt to curry favor with the mayoral candidate. Sanz reluctantly complied and wrote $6000 worth of checks, which were turned in during a June 1996 fundraising event targeting insurance industry executives. The event was organized by former North Miami mayor Michael Colodny.