Treasure Island

In legendary outlaw haven North Bay Village, a prominent physician's reputation is on the line.

In 2003, Charles and James oversaw conversion of the Grandview into condominiums. The building has been defined by ill will ever since. They were two of three members on the board of directors, and in essence controlled the building's finances and maintenance when condo owners began complaining of disrepair. Nine months after Hurricane Wilma slammed the building, residents picketed outside to complain about needed repairs, including blasted windows and damaged walls, water pipes, and balconies.

The city's chief building official, Paul Gioia, says he took control of the building in November 2005 until developers completed $2 million in repairs. He found infractions at the building that he claims predated the storm, such as broken fire sprinklers, problematic elevators, faulty wiring, and construction work done without permits. "It is just the arrogance of power," Gioia says. "He didn't want to spend what he didn't have to. It was one of the worst-maintained buildings I've seen in the last 20 years."

Edwards wasn't cordial about the interference when the Miami Herald questioned him at the time. "Either the guy is suffering from Alzheimer's or he just makes up crap," he grumbled about Gioia.

The latest conflict might be harder to shake off. On January 29, 2004, according to court records, Edwards penned the Grandview Condominium Association to announce he had found an insurance company that would provide the building with general liability coverage for thousands less than the previous carrier.

The letter didn't reveal that the doctor was a managing member of Florida Mutual Assurance — or that the papers establishing the firm had been filed the same day he wrote the letter. Nor did it disclose that, according to prosecutors, Florida Mutual wasn't licensed to provide insurance in any state.

The same week the missive was sent, two founding partners of Florida Mutual, Brickell attorney Juan Zorrilla and insurance agent Vidal Sainz, quit the company, state records show. (Neither Sainz nor Zorrilla returned messages left at their offices.)

James Edwards then signed four checks totaling $233,730 from the Grandview Palace's bank account to Florida Mutual. The checks were deposited into a Maryland Merrill Lynch account controlled by Charles, North Bay Village cops discovered.

The plan began to unravel last May, members of the condo association charge, when new property owners replaced the father-and-son developers on the board of directors. The board's newly hired lawyer, Aaron R. Cohen, learned that a 2005 case, in which an elderly woman sued after falling on the pool deck, hadn't been handled by an insurance company. "I asked James: 'Where's all the insurance information for 2004 to 2005?'" Cohen recalls. "He produced a policy that just didn't look right: The text was different sizes, different fonts — it looked like an old-school cut-and-paste job that was put together by somebody in tenth grade."

Cohen was alarmed, he says, when he traced Florida Mutual to Charles Edwards. On March 4, the condo association filed a civil suit seeking $701,000 in damages from the developers.

The same day, the State Attorney's Office charged the company with organized fraud, grand theft in the first degree, and issuing insurance without a license — all felonies.

Says the Edwardses' attorney, Davis: "My clients got a bid from their existing insurance provider that was astronomical. They looked around and decided to create their own provider. James Edwards saved the [condo] association about $150,000 in premiums. Out of gratitude, they've sued him."

Florida Mutual's lack of an insurance certificate stemmed from a misunderstanding, Davis claims. "They received advice that state licensing wasn't required," the lawyer says, declining to elaborate on the origin of that advice.

But insurance agent Sainz told investigators he had informed Dr. Edwards that "operating an insurance company in the State of Florida required specific licensing which the company did not have" and that skirting that requirement "constituted a felony," according to a North Bay Village police report. Sainz quit two business days after papers were filed with the state creating Florida Mutual because he "could not be affiliated with [this] company," he told cops.

Asked about Sainz's resignation, Davis responds, "I don't know anything about that."

Even if Florida Mutual is criminally convicted, the surgeon and his son will face only financial sanctions. "Well, you can't put a corporation in jail," says Assistant State Attorney Fred Kerstein, who's prosecuting the case, "but you can certainly obtain fines or restitution. Obviously, you want to try to get as much money for the association as possible."

State Attorney's Office spokesman Ed Griffin implies it's unlikely individuals will be charged: "We aren't inclined to be used as a pawn in another game."

Republican state Rep. Julio Robaina, a white-collar crime crusader who has taken an interest in the case, says the State Attorney's Office is in danger of setting a lamentable precedent. "If you steal a car worth $233,000, you can bet you'll be charged with a felony," he says. "[This] sends a message to the rest of the country, saying, 'If you want to commit fraud, come to Miami-Dade County. The worst that will happen is you have to pay back the money you stole.'"

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