Bilked: another story from South Florida ... by gimleteye

"Miami's little Madoff" is how one Cuban American investor described a prominent businessman and his wife, Gaston and Teresita Cantens (Trust turns to crisis for older investors, Miami Herald, March 4, 2010) . The Cantenses, a politically influential family, were charged with a $135 million real estate related investment fraud, or, Ponzi scheme.

It is inevitable the housing boom and crash, whose political origins were in Miami, would reach into the ranks of elderly Cuban and Latin American investors. This one is particularly redolent: "The Cantenses, said SEC officials, told investors that Jesuit priests and other well-known leaders in the Cuban American community had invested with Royal West. They 'targeted' investors at charitable and religious gatherings and at parties at their Miami home." According to the Herald, the Cantenses also exploited their relationship with members of the prominent Cuban American bastion and feeder of political leadership, Belen Jesuit Prep.

Of the master-strokes facilitating the housing boom, one was a new law passed by the Florida legislature in 2002. It was sponsored by then state representative Gaston I. Cantens, a rising star in the Growth Machine. The measure, called the Everglades Bill or HB 813, helped also to divide and conquer the environmental community. The bill provided $100 million for the Everglades at the same time as eroding citizen rights to protest ill-advised developments, such as those promoted in West Dade suburbs. (Audubon supported the bill, and many other environmental groups blasted it, leading to mistrust in Florida that continues to this day.)

The Cantens bill helped along the process of so much crappy, fetid overdevelopment that fit the needs of Wall Street finance -- and continuous pressure by big, special interests. Today's sad news about "Miami's Little Madoff" is just another blip on a radar screen filled with the static of trillion dollar bailouts by taxpayers and concessions to the flattened homebuilders. In the 2002, the bill Cantens, the son, pushed through raised the threshold for community groups to challenge changes to growth plans. It was a delightful resume builder: eventually Cantens left to the legislature to take on the job as vice president for public relations for Fanjul family sugar barons.) The Herald notes that the son is not named in the SEC complaint.

In 2002, the St. Pete Times editorial board, along with every editorial board in the state, weighed in against the Cantens measure, calling it an "unwarranted assault" against citizen standing: "Now, if a developer seeks a permit on a project that threatens to degrade the environment, Florida residents have a reasonable opportunity to oppose the permit. There is no indication that the right is being abused or that developers are thwarted if their projects are responsible. Yet a fair hearing for the environment is too much to ask of some legislators." (April 3, 2002)

The housing boom in West Dade farmland and wetlands minted South Florida millionaires by the barrel full. The SEC charges that the Cantenses used "$20 million from investors to pay themselves exorbitant salaries, to invest in other projects and to divert some $1 million to their children and grandchildren in the form of alleged 'consulting fees'. The website, Condo Vultures, paints the background of crashed real estate empires: "Delinquent real estate loans at Florida-based banks spiked by 47 percent in 2009 compared to a year earlier as the number of financial institutions in the state decreased by 21, according to a new report from CondoVultures.com."

The Miami Herald doesn't specify what investments, exactly, comprise the failed Cantenses' portfolio called Royal West Properties, but Condo Vultures provides context to the overall market for suburban sprawl that was triggered by the housing boom and its political origins in West Dade suburbs: ""Residential real estate prices have tumbled significantly since the peak of the market in the fourth quarter of 2005," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures® LLC. "The challenge for many buyers is the under-$250,000 properties are increasingly located west of Interstate 95 in the suburban areas of South Florida."

Those ghost suburbs aren't filling with happy and gullible new buyers any time soon. Still the stories of personal devastation, of families ripped apart, and dreams dashed are only just beginning to be told. How it all ties back to "The Ownership Society" and its political origins in Miami is still nowhere to be found in the mainstream media.