By Chuck Strouse
By Scott Fishman
By Terrence McCoy
By Ryan Yousefi
By Ciara LaVelle, Kat Bein, Carolina Del Busto, and Liz Tracy
By Pepe Billete
By Ryan Yousefi
By Kyle Swenson
In March 2000, after a yearlong investigation, the United States Federal Election Commission (FEC) made public an eighteen-page report on its audit of the Lincoln Diaz-Balart Campaign for Congress. The audit -- only the fifth in three years to target a member of Congress -- covers the 1997-98 election cycle, during which U. S. Rep. Diaz-Balart (R-Fla.) had been re-elected to a fourth term in the House. This past November Diaz-Balart won his fifth term without opposition. He is one of three influential Cuban-American members of Congress and wields considerable power in the U.S.-Cuba policy arena.
The FEC audit of the Diaz-Balart campaign, however, reveals an operation with little regard for federal election laws. The report describes a stunning array of campaign finance violations and stupid mistakes, all discovered largely without the help of an evasive and uncooperative Diaz-Balart staff. Auditors cite dozens of illegal campaign contributions, missing cash, bookkeeping errors amounting to hundreds of thousands of dollars, and failure to report a variety of monetary receipts and expenditures. To top it off, aides never produced all the records and documentation requested by auditors.
Despite its disturbing contents, the audit has never attracted much public attention, and even Diaz-Balart's worst enemies don't deceive themselves into thinking the congressman's campaign finance irregularities will tarnish his bright political prospects. This past May Diaz-Balart agreed to pay a $30,000 fine, to come from his abundant campaign funds. (The FEC did not announce the penalty until July 18.) In February of this year, the campaign paid a $5500 fine for filing late disclosure reports. While the $30,000 fine is considered "steep" compared with other FEC enforcement actions against congressional campaigns, it is far less than the $100,000 to $200,000 some political insiders had been predicting and believed was appropriate -- and which is closer to the scale of the violations cited by the FEC.
The first public mention of Diaz-Balart's trouble with the FEC came seven months after the audit was released, in an October 30, 2000, story by Dan Christensen in the Daily Business Review. The article announced the commission's intention to fine the representative for persistently filing late disclosure reports. Then a Daily Business Review article a week later, the day before Diaz-Balart was re-elected in the 2000 general election, described the audit findings.
Throughout the tumultuous 2000 election cycle, the news media had more immediate issues to cover than Diaz-Balart's campaign finance violations. He faced no opposition for re-election, but he did advertise, almost exclusively in Spanish-language media, and the donations continued to pour in from contributors ranging from business executives and housewives to labor unions and political action committees. Naturally the monetary support fortified Diaz-Balart's stature as an incumbent -- he hasn't faced a serious challenger since he first sought the congressional seat -- and intimidated any prospective opponents. According to one financial disclosure, the campaign's cash-on-hand balance at the end of 2000 was more than a half-million dollars. (Later revelations of more than $100,000 in unreported expenditures and more than $50,000 in unreported contributions would call the amount into question.)
Throughout December 2000 the Daily Business Review followed its initial story about the audit with more details on the plethora of violations uncovered by FEC analysts. The Miami Herald and El Nuevo Herald picked up on the audit news in a December 2000 article that quoted an FEC spokeswoman who called the findings "very significant" and promised the commission would continue its "pursuit of answers."
Ana Carbonell, Diaz-Balart's campaign manager and long-time aide, responded to the coverage with a series of lame excuses. She contended she didn't know the FEC's final audit report had been released in April 2000 (FEC records show it was mailed to Diaz-Balart's office in late March), and then, according to the Daily Business Review: "[Carbonell] also said the FEC's calculations contain errors and simply don't add up." Once, in an effort to prove a disclosure report was filed earlier than the FEC claimed to have received it, Carbonell gave Christensen a FedEx airbill number. FedEx, however, couldn't confirm delivery of the document.
Carbonell, a well-known Cuba-issues activist in her own right, wound up taking most of the heat for the fiasco. She prepared many of Diaz-Balart's financial disclosure forms, no doubt at least partly because of the extended illness of former campaign treasurer Ayuban Tomas, who should have known proper reporting and book- and record-keeping procedures. And Carbonell, as Diaz-Balart's principal liaison with the FEC during the audit, has been blamed by her boss for not informing him of the commission scrutiny (even though she claimed to the Herald and the Daily Business Review that she did apprise Diaz-Balart of the FEC inquiries). Carbonell did not return two phone calls seeking comment from New Times.
But the audit and subsequent amendments and corrections tend to raise more questions about what the congressman's bookkeepers were doing over the years. Only one thing is clear: The law-and-order Republican has been filing inaccurate and misleading FEC reports since he first was elected to Congress in 1992. Although a number of violations discovered by the FEC in 1999 were promptly fixed, auditors' repeated attempts to balance the books (including subpoenas of bank records) ultimately proved unsuccessful.