Rivera faces allegations that he failed to disclose loans from a company owned by his mother. Rep. Rivera facing ethics issues

Just three weeks into his congressional career, Rep. David Rivera (R-Fla.) has earned the dubious distinction of being the first member of the historic class of House GOP freshmen to find himself at the center of an ethics scandal.

The Rivera case also could prove an early and politically sensitive problem for Speaker John Boehner of Ohio, House Majority Leader Eric Cantor of Virginia and other top Republicans who criticized former Speaker Nancy Pelosi’s handling of scandals involving Reps. Charles Rangel (D-N.Y.) and Maxine Waters (D-Calif.).


Boehner has yet to comment on the allegations involving Rivera, yet behind the scenes, GOP insiders already are drawing contingency plans for a replacement should the freshman lawmaker resign or be forced to step aside, according to multiple Republican sources.

Cantor, meanwhile, has promised a “zero-tolerance policy” for GOP lawmakers caught up in the scandals. But so far, the Virginia Republican has refused to comment on the Rivera case, drawing criticisms of hypocrisy from the Democratic Congressional Campaign Committee.

The 45-year-old Rivera, who was elected to the House in November after eight years in the Florida Legislature, has been under investigation by the Florida Department of Law Enforcement since last fall over allegations that he failed to disclose more than $130,000 in loans from a company owned by his mother. Rivera has since repaid the loans by selling off some real estate, but there are least two parallel probes into his finances and campaign records going on now, and Democrats have seized on the controversy to embarrass the House GOP leadership.

“Republican leader Eric Cantor pledged zero tolerance on ethics [violations], but it’s been 19 days, and he refuses to address the expanding investigation into Congressman David Rivera’s scandal-plagued record,” said Jesse Ferguson, a DCCC spokesman.

Cantor aides counter that the majority leader is aware of the allegations swirling around the Florida freshman, but they note that the state probe is ongoing, and Rivera has not been charged with any wrongdoing at this point. So at this point, Cantor will not take any stance on what should happen in the Rivera case.

“Eric has said that, unlike leader Pelosi and the previous majority, Republicans will have a zero-tolerance policy [on ethics violations], and we are awaiting the results of the current investigation in Florida,” said Brad Dayspring, a Cantor spokesman.

While Democratic ethics woes were not a central factor in the Republicans’ victory in retaking control of the House on Election Day, Republicans used the Rangel and Waters cases to lambaste Pelosi for failing to “drain the swamp” of Washington corruption. Rangel was censured by the House in December after he was found guilty of 11 ethics violations. The investigation into Waters is ongoing. The California Democrat has been charged with three ethics violations related to her dealings with a minority-owned bank in which her husband owned stock during the 2008 U.S. financial crisis. Waters has denied any wrongdoing.

And while the Rivera investigation is still in its early stages in Florida, GOP leaders also are hamstrung over the fact that the House Ethics Committee — which has still not formally organized for this Congress as Democrats have not named their full list of panel members — is barred by its own rules from taking up any matter where law-enforcement officials already are involved.

That means top Republicans couldn’t seek Ethics Committee intervention in this matter even if they wanted to do so.

In addition, there is anger and frustration at Rivera in GOP leadership circles. Rivera is described by Republicans as being “less than candid” or “not forthcoming” about his ethics problems in conversations with leadership aides and campaign operatives, and they have been surprised on several occasions as new allegations surface.

“It’s only a matter of time before the eighth shoe drops,” said one senior House Republican staffer, speaking on condition of anonymity.

Part of the problem for GOP leaders is that the allegations involving Rivera stem from before he was elected to the House, spurring questions about what, if anything, the leadership can do in the case.

“At this point, we’re not aware of any allegations that involve his service in the U.S. House,” another leadership aide said in explaining top Republicans’ silence on the issue.

At the center of the Rivera investigation is a company called Millennium Marketing Strategies, controlled by Daisy Magarino and Ileana Medina, Rivera’s mother and godmother, respectively. The company is accused of secretly receiving more than $500,000 from Flagler Dog Track in early 2008 for its work on a successful referendum campaign to approve slot machines at parimutuel betting offices in Miami-Dade County, according to The Miami Herald. Voters had rejected an earlier slots referendum in 2005.

The newspaper reported that Rivera strongly backed the slot-machine proposal during his time in the state Legislature, adding that he personally suggested routing the payments from Flagler Dog Track through his mother and godmother’s company. Rivera co-signed the consulting contract between Millennium and Flagler Dog Track, despite the fact that he was not listed as an officer for Millennium.

Rivera repaid the loans to Millennium in November with interest, according to an updated financial-disclosure form that he filed.

But Florida investigators reportedly are looking into campaign payments made to Millennium in 2006 and an additional $75,000 his campaign doled out in 2010 to a firm owned by the daughter of a top aide, according to media reports.

The Federal Election Commission is scrutinizing the Rivera campaign as well.

In addition, Rivera repeatedly claimed to have worked for USAID during the campaign — stating that it was his main source of income outside his $30,000 annual salary as a state legislator. But the federal agency says it has no record of his ever having done so.

Rivera now says that he worked as a subcontractor on USAID projects, not as a lead contractor, although he won’t disclose the names of the companies he worked for in that role.

Rivera would not comment directly on the ongoing investigations, although aides said he has not hired a defense attorney at this point or set up a legal-defense fund to cover the costs of any related fees brought on by the probes.

“The congressman has not hired an attorney and has not set up a legal defense fund,” said a Rivera campaign spokesman. “Nor does he see any need to do so, particularly given the fact that the local state attorney recently concluded there was no rationale” for the state to investigate further.

Democrats in Florida and Washington continue to attack Rivera’s credibility, noting that he has offered multiple — and sometimes contrary — statements on the burgeoning scandal, although they caution that he has not been charged at this point.

Rivera “may have innocent explanations for the investigations that we haven’t heard, but as I read how it keeps broadening into different areas over several periods of time, that list of innocent explanations is getting smaller,” said Richard Lydecker, chairman of the Miami-Dade County Democratic Party.

“Florida has some shady characters, and it leads the nation in corruption, one of the few things we’re known for,” said a Sunshine State Democratic strategist. “I’d be shocked if he even lasts through the end of this term.”