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
As the WFC case illustrated, these were heady times in Miami. This was Reagan-era, investment-banking boom time. Neon lights and cocaine time. The red threat hovered menacingly, the Cold War simmered, and the CIA worked its agents and informants on the streets of Miami Beach and Little Havana to fight not only Castro's regime but also leftist movements burgeoning in Nicaragua and El Salvador. Miami was to the Eighties what Casablanca was to the late Thirties -- a hotbed of spooks, crime bosses, and cops playing each other for all they were worth.
Back from Texas, a freshly exonerated Padreda wasted no time taking advantage of the surging economic climate. By the mid-Eighties he had more than a half-dozen low-income housing projects up and running, all fueled with HUD loans, grants, and loan guarantees. There was the HUD-insured, $17.8 million Casa del Lago apartment complex in Kendall; the $2.1 million Riverside Apartments for seniors in Miami; the Airport Seven office building, which received a $1.4 million federal loan guaranteed by the City of Miami; Fontanar Park, a $3.2 million HUD project in the southwest part of the county; and the $7 million Esperanza Turnkey housing project in Hialeah that Padreda was bidding on. (Despite Padreda's evident success, in 1984 HUD inspectors sought to "debar" his construction company -- ban it from future government contracts -- for allegedly underpaying employees on the Riverside Apartments project in Miami and then forging documents to hide that fact. Padreda's company paid a fine without admitting guilt and a judge ruled against debarment.)
Padreda was also hard at work gaining influence with the gatekeepers to all that taxpayer money. He became the Dade County Republican Party's finance chairman, and he collected cash for political candidates. He was a regular at fundraisers, where he schmoozed politicos and promised his support and friendship. "He's a very intense guy, and he's very bright," says former Miami Mayor Maurice Ferré, who knew Padreda from power-circuit parties. "He's got that Cuban populist charm about him." An ex-federal official who knew Padreda from that era describes him as someone "who liked to brag that he could help you." He cultivated relationships with state Insurance Commissioner Bill Gunter and Gov. Bob Martinez. In 1988 President Reagan made him a "distinguished presidential appointee" to the White House's Conference for a Drug Free America. He even had business dealings with the young Jeb Bush.
One of Padreda's HUD projects was an office complex he built at 5040 NW Seventh St., across State Road 836 from Miami International Airport. Signing on as a tenant was Miguel Recarey, a wealthy Cuban businessman whose company, International Medical Centers, would become the nation's largest health-maintenance organization. But Padreda had trouble finding occupants for the rest of his building, so he hired Jeb Bush's firm, Bush Klein Realty, as a leasing agent to secure tenants. Bush, however, was unsuccessful. (Recarey, who like Padreda was a Republican fundraiser, also hired Bush and paid him $75,000, ostensibly to find new headquarters for his company. Recarey would later flee a federal investigation into massive health-care fraud. From Spain, where he now lives as a fugitive, he would tell ABC's 20/20 that hiring Bush was just a way to gain political influence. It seems to have worked. At Recarey's behest Bush had contacted federal regulators to ask that Recarey receive a fair hearing on a requested exemption from federal laws that would affect his HMO empire.)
Padreda also developed a special friendship with an up-and-coming young public official named Sergio Pereira. In 1985 Padreda and some business partners negotiated to buy a parcel of land at the corner of West Flagler Street and 114th Avenue from a corporation controlled by Manuel Lopez Castro, who later became a fugitive after being charged with laundering drug money. Padreda and partners purchased the land for $925,000. One of the people Padreda cut in on the deal was Pereira, an assistant county manager at the time. Pereira put no money down but was nonetheless made a 25-percent partner in the property. A few months later the Dade County Commission voted unanimously to rezone the land so a shopping complex could be built there. (Years later Padreda would testify he paid Commissioner Jorge Valdes $40,000 for his vote. Valdes vehemently denied the accusation.) Padreda and partners then flipped the property for $1,533,000 -- a $608,000 profit. Pereira cleared $127,000 on the deal without having invested one penny.
Three months later Pereira, who had become Miami city manager, created a special job for Padreda's daughter on the municipal payroll. He reclassified a vacant secretary's position into a new post titled "User Support Representative," according to the Miami Herald.
In 1988 the Herald came across the land deal and wrote a series of stories about it. Pereira, who by then had taken a big step from city manager to Dade County manager, had not listed the transaction on his financial-disclosure forms, though he did report it on his federal tax returns. He said the failure to disclose was an oversight. Then it was revealed he had subsequently hired Padreda's daughter. "Can't I ask a favor of anybody to give a job to my daughter?" the Herald quoted Padreda as saying. By then public confidence in Pereira had eroded to the point he was forced to resign.