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27th August

 First Published in The New York Sun, August 27, 2004

By Andrew Wolf

There are many worthy charities that New Yorkers can support. Last year, State Attorney General Eliot Spitzer made up a little list of his own favorites that he handed over to Philip Anschutz, the former chairman of Qwest. 

    Mr. Spitzer charged that Mr.Anschutz illegally profited by getting in on profitable initial public offerings, courtesy of the brokerage Salomon Smith Barney.That was alleged to be in exchange for steering lucrative investment banking business to the firm. 
    To settle the case, Mr. Anschutz agreed to pay a penalty of $4.4 million. But none of this went to any aggrieved party. Some $200,000 went to each of six law schools and $100,000 each went to 32 charities chosen by Mr. Spitzer. Among the favored groups,some are familiar to most: The Metropolitan Museum of Art, the American Museum of Natural History, Memorial Sloan-Kettering Cancer Center, the Girl Scouts of the USA — but not the Boy Scouts — and the Police Athletic League. 

    Why should a public official be able to substitute his or her own individual judgment as to the worthiness of charities? This seems to me a form of philanthropic patronage that has the potential for abuse.That could be the case with the money Mr.Anschutz paid to settle the complaint against him. 

    The name of one group jumped out at me from Mr. Spitzer’s list: the Hispanic Federation of New York City. Two others were curious as well, since they are both component groups of the Hispanic Federation, Promesa Inc. and the Institute for Puerto Rican and Hispanic Elderly Inc. 

    This is a curious form of philanthropy that Mr. Spitzer is practicing.With the possible exception of the Anti-Defamation League of B’nai B’rith, I see no other organization on the list that is so overtly directed at a particular ethnic group.Why was the Hispanic Federation so fortunate in Mr. Spitzer’s distribution scheme?

    The Hispanic Federation could not have been an unfamiliar group to Mr.Spitzer.It played a key role in Mr. Spitzer’s razor-thin election victory over the incumbent Republican attorney general, Dennis Vacco, in 1998. 

    Questioned about the death penalty, Mr.Vacco was quoted by the Jewish Week newspaper as saying, “We don’t do surveys of criminals. You don’t stand outside a bodega and ask the bandito if he would have killed somebody if there was no death penalty.” 

    Lorraine Cortes-Vazquez, then and now the president of the Hispanic Federation,was quoted in both the New York Times and Daily News expressing outrage over Mr.Vacco’s remarks. 

    “He doesn’t even realize the implications of his choice of words. The whole sentiment is a disparaging one. It’s such a poor reflection that he has on the Latino community.” 

    The “bandito” incident helped turn the spotlight away from the serious questions raised by the disclosure that Mr. Spitzer had financed his primary campaign with a $3.8 million loan from his father, rather than with his own personal assets. The attacks on Mr. Vacco by Ms. Cortes-Vazquez, the only Hispanic leader quoted in the Times article,may well have tipped this closest of all recent New York State elections to Mr.Spitzer. 

    Ms. Cortes-Vazquez is not the typical nonpartisan head of an independent nonprofit.She served as chief of staff to former Bronx Democratic boss Roberto Ramirez. Both she and her husband, Louis Vazquez, retain ties to the Bronx Democratic machine. Ms. Cortes-Vazquez receives one patronage plum after another from the machine, and Mr.Vazquez gets help with contracts for the expanding non-profit empire he heads in the Bronx,RAIN Inc.,which is a component organization of the Hispanic Federation. 

    Mr. Ramirez arranged for Ms. Cortes-Vazquez to serve as a Democratic elector in 2000, a position reserved for loyal party stalwarts. She was named in 2002 by the machine-controlled Bronx City Council delegation to fill the borough’s seat on the city’s Police Civilian Complaint Review Board, and then was appointed to the Bronx seat on the New York State Board of Regents, replacing Ricardo Oquendo, Mr. Ramirez’s law partner. These are all appointments controlled by the party organization. 

    Mr.Spitzer also has close,ongoing direct ties to Ms. Cortes-Vazquez’s patron, Mr. Ramirez. The Spitzer 2006 committee has already paid $47,383.25 to Mr. Ramirez’s affiliate, Global Strategies Group. The Spitzer 2002 committee paid Mr.Ramirez’s consulting firm Mirram Group $63,027.58, and Global Strategies a whopping $219,472.39. 

    In an article published in The New York Sun earlier this year, my colleague William F. Hammond Jr. disclosed that Mr. Ramirez’s firm, in a memo to a prospective client, bragged of his ties to key “decision makers,” Mr. Spitzer prominent among them.That memo read, “Elected officials have entrusted their careers to us, and we have delivered. In turn, we are now able to provide our clients with access and opportunity to an often impenetrable world…Our special relationships with key decision makers mean we can make the necessary introductions with the least amount of delays or confusion, while ensuring the greatest opportunity for successful intervention on our client’s behalf.” 

    In the context of the tangled web woven by Mr. Ramirez, between his firms, his clients, and his fees, one wonders whether the presence of the well-connected Hispanic Federation and affiliates on the list to receive an unexpected contribution from an unwitting donor forced to make this payment under duress isn’t just a new 21st century form of political patronage?

© 2004 The New York Sun, One, SL, LLC. All rights reserved.

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