Wasn't Kiar the attorney at the time?

Attorney: Davie could sue ex-mayor over investment
An attorney concluded that Davie improperly invested $275,000 during the tenure of former Town Administrator Chris Kovanes.
BY BREANNE GILPATRICK
bgilpatrick@MiamiHerald.com

Davie could sue former Mayor Harry Venis and one of his business associates to recover $275,000, which a town lawyer says was improperly invested.

The town purchased the investment, an annuity, last year, after Venis and a business associate, insurance broker Jeffrey D. Bliss, discussed the possibility with former Town Administrator Chris Kovanes.

UNRELATED CHARGES

Kovanes now awaits trial on unrelated theft and fraud charges.

The town asked attorney Susan Delegal to review the transaction this spring, and she issued a report of her findings in a letter to Mayor Tom Truex this week.

She concluded that:

• A Brow- ard State Attorney's Office investigation found no evidence that Kovanes violated criminal laws by accepting something of value for the creation of the annuity.

• Under state law and town rules, the annuity is not on the list of permitted investments of town money.

• Bliss earned a $24,000 commission for the sale, and he split it with Venis.

• The company providing the annuity, Allianz Life Insurance Co. of North America, doesn't want to give the town its full money back. Instead, the company told Delegal, the town could get $245,000 now or at least $288,000 in 10 years.

• If the Town Council wants its full money back sooner than that, then it could demand it from Allianz, Bliss and Venis. If they refuse, the town could sue on the premise that the transaction was invalid because the investment was not allowed by law.

• The town could ask the state chief financial officer to investigate whether Bliss's 9 percent commission was proper.

Bliss could not be reached for comment Wednesday.

BAD DECISION?

Venis' attorney, Daniel Aaronson, said his client shouldn't be punished if the town made a bad investment decision.

''The bottom line is their legal staff looked into it and agreed with it,'' he said.``If there's any punishment it should be for the city.''

Annuities are contracts sold by insurance companies that are commonly used to provide retirement income for individual investors.

Truex said the town will attempt to recover the money lost in the deal. He also said legal action was a possibility, if other efforts to recover the money fail.

Jim McManus, an Allianz spokesman, said he couldn't comment on the specifics of any policy.

''But I can say if a policy holder ever does have a concern, we encourage them to contact the company so we wan address those concerns,'' McManus said.

The money to buy the annuity came from Westbrooke Companies Inc., according to Delegal's report. In February 1999, Westbrooke promised the town $300,000 to maintain and monitor a 39-acre parcel as it was transformed into a wetland. Westbrooke was supposed to pay the town in five years.

In July 2005 the town agreed to allow Westbrooke to pay only $275,000 if the company paid up immediately. The town used that money to purchase the annuity.