Sunday, May 24, 2015

John Simmons, Dan Sherman and buck consultants

         This week we investigate the genesis of Providence Pension Fraud. Someone designed this scheme in the last decade and made a deliberate decision to borrow from the pension fund to cover a dangerous drop in the city's operating cash flow. The likely start of the scheme is somewhere between the  "Category 5" revelation by Angel Taveras in 2011  and his predecessor David Cicilline's fond farewell to John Simmons as his Director of Administration a few years earlier where they both claimed victory over budget, union and pension issues.

      Here's how David Cicilline put it in 2007:

Mayor's Chief Architect in Restoring Fiscal Integrity to City Government to Step Down   November 8 2007

Mayor David N. Cicilline today announced that the City’s Chief of Administration, John Simmons, will step down at the end of the year to take on the role of Executive Director of the Rhode Island Public Expenditure Council (RIPEC). The Mayor hailed Simmons as “one of the foremost authorities on public finance in the northeast” and credited him with playing a major role in getting the city’s financial ship back on course.

“John has been an invaluable member of my team from the very beginning,” said Mayor Cicilline. “His vast experience, financial expertise and keen understanding of the intricacies of public finance have helped put our city government on the strong financial footing needed to accomplish my ambitious goals for the city,” said Mayor Cicilline. “Although John will be missed, he leaves behind a legacy of fiscal integrity, 21-Century labor agreements and “A” grades from all major bond rating agencies.”

      Here's Cicilline in 2010  in Debate with John Loughlin

Loughlin: The City of Providence is broke and you know it … 

Cicilline: The City of Providence has earned an ‘A’ rating from its agencies which are not, you know political campaigns, but are done by professionals externally on the city’s financial condition. I’m very proud of that. The city is in excellent financial condition and the suggestion by the city council auditor that was condemned by the President of the City Council as reckless and false. Representative Loughlin knows that.

Loughlin: Then why won’t you give him the data? Why? He had to file a freedom of information act!

and here is Taveras in 2011

Mayor: Providence, RI, Faces Bankruptcy

Mayor Angel Taveras painted a bleak picture Thursday of the city's finances, saying Providence faces "devastation" and could go bankrupt if retiree benefits aren't cut and tax-exempt institutions like Brown University don't pay more in lieu of taxes.

So now, of course ,we all know that Cicilline was lying through his teeth. But when? Was it in 2006-7 or 2011  or both?  The John Simmons  2007 angle is intriguing and he would certainly be a great person for the Feds to talk to. Its unclear if he was  ever  questioned by the SEC when they looked into Providence irregularities in 2011. Its pretty clear now that the SEC did not "catch" the Fraudulent assets in 2011 that Segal recently confirmed. This huge revelation  also means that the City misled the SEC during their investigation in 2011. .. (to be continued)

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