Loughlin Spokesman Calls for Federal Investigation into Providence Finances
Saturday, November 26, 2011
A spokesman for likely Congressional candidate John Loughlin is calling for a federal investigation into the city of Providence’s finances during Congressman David Cicilline’s tenure as the capital city’s Mayor.
Loughlin, who lost to Cicilline in 2010, relentlessly criticized the former Mayor’s handling of the city’s finances throughout last year’s campaign and now thanks to recent revelations about two nonprofit organizations that had direct ties to Cicilline, spokesman Michael Napolitano is calling for the feds to step in.
"Given the financial situation in the city of Providence and the fact that many things have not been brought to light, it is very clear that David Cicilline left behind a fiscal nightmare as well as possible improprieties,” Napolitano said. “I feel a full federal investigation into the finances is warranted.”
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTStruggles at PEDP and ProCAP
As GoLocalProv first reported last month, the Providence Economic Development Partnership (PEDP), a nonprofit that offered loans to small businesses, has an exorbitantly high default rate and used questionable tactic s in order to hide the amount of delinquent loans handed out in recent years.
In one case, the city simply converted a loan it had taken out to pay for the Bank of America Skating Center into a grant in order to avoid paying off the loan. Several individuals and organizations also received loans even after they were late to pay previous loan balances.
Napolitano said he doesn’t believe Cicilline was unaware of the high default rate.
"He's either severely incompetent or had full knowledge of what was going on, so which is it,” he said.
The city is again facing scrutiny after the state threatened to close the Providence Community Action Program (ProCAP), the anti-poverty organization that has been accused of failing to pay vendors while handing out interest-free loans to its employees. The Mayor appoints five board members to the organization’s 15 member board.
ProCAP’s Executive Director Frank Corbishley was recently suspended without pay and its Chief Operating Officer William Bentley was fired Friday.
Spokesman: Cicilline Denied Everything
Cicilline has said a review of the organization’s operations is warranted.
"The allegations recently made surrounding the management of the Providence Community Action, a non-profit agency, are serious,” Cicilline said. “This agency has the responsibility to provide assistance to some of the most vulnerable members of our community, and relies upon government funding to do much of this work. Those responsible for operating this agency are expected to be responsible stewards of these public funds and must be fully accountable. The members of the Board of Directors have the responsibility to provide proper oversight to this organization, and the full review of the agency’s operations by them is clearly warranted.”
But Napolitano maintains the two struggling nonprofits are just another example of a lack of oversight during the Cicilline administration.
"John Loughlin was the first to call attention to the fiscal mess during the debates and David Cicilline denied everything,” Napolitano said. "It is very clear David Cicilline will do whatever he can not to answer any questions of the taxpayers of providence."
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