Tuesday, October 26, 2010

W.I.R.E.D. Spells Trouble for Office of Mayor Hickenlooper

DENVER, CO: On February 1, 2006 the US Department of Labor (USDOL) awarded the Colorado Department of Labor and Employment (CDLE) a $15 million dollar Workforce Innovation and Regional Economic Development (WIRED) grant. CDLE then awarded $11 million dollars to Mayor Hickenlooper with the City and County of Denver to be the fiscal agent. The City of County of Denver and their partner, Metro Denver Economic Development Corporation (under Tom Clark) was to administer the grant according to and in compliance with federal rules and regulations.

Spotlight on Corruption (SOC) has learned that CDLE’s internal auditors and program monitors found 2 problematic tracks with the distribution of funds, both financial and conflict of interest. When findings were reported to Donald Mares, Executive Director of CDLE, a cover up ensued; including a manipulated audit, and an attempt to manipulate the Denver Board of Ethics. The findings of questionable and disallowed costs would require the City and County of Denver under Mayor Hickenlooper to be liable to pay back the funds out of City money (money the city doesn’t have) to the Federal Government - - possibly over 3 million dollars.

Financial Violations Discovered

According to sources, funding did not follow federal guidelines; 9 grants were backdated; 11 grant’s costs totalling $1 Million were incurred before contracts were executed, and most disturbing, bonuses were paid out of federal funds when furloughs were intact - - bonuses paid were based on profit in excess of costs - which is disallowed by the Federal Government. Contracts were awarded to the University of Colorado ($135,000) to the Children’s Campaign ($75,000) and to the Colorado Association of Manufacturing and Technology (CAMT) ($125,000) without any procurement.

Conflict of Interest; Ledy Garcia-Eckstein appointed Executive Director of WIRED

Ledy Garcia-Eckstein, who works closely with Hickenlooper and his appointees, was in charge of managing and distributing funds as well as negotiating contracts and signing off on payments. SOC has discovered that Garcia-Eckstein steered WIRED funds to organizations and companies where her husband, John Eckstein of the Denver Legal Firm Fairfield and Woods, could have directly benefited . . .....

SOC will be issuing a series of reports on the details behind this story.