STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

MANOHAR SINGH SURANA, )

)

Petitioner, )

)

vs. ) Case No. 02-1060

) CITY OF MIAMI, GENERAL EMPLOYEES ) AND SANITATION EMPLOYEES )

RETIREMENT TRUST, )

)

Respondent. )

_________________________________)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case by video teleconference on December 16, 2002, with the parties appearing from Miami, Florida, before J. D. Parrish, a designated Administrative Law Judge of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Ira M. Elegant, Esquire

Buchbinder & Elegant, P.A. Commonwealth Building, Fourth Floor

46 Southwest First Street Miami, Florida 33130-1610

For Respondent: F. Philip Blank, Esquire

Blank, Meenan & Smith, P.A.

204 South Monroe Street Tallahassee, Florida 32301

STATEMENT OF THE ISSUE

Whether the Petitioner, Manohar Singh Surana, by pleading guilty to a charge of conspiracy to commit money

laundering in violation of Title 18, United States Code, Section 371, committed a "specified offense" under Section 112.3173, Florida Statutes, such that he must forfeit retirement benefits.

PRELIMINARY STATEMENT

On January 18, 2002, the Respondent, City of Miami, General Employees and Sanitation Employees Retirement Trust, by its Board of Trustees (the Board), approved the forfeiture of the Petitioner's retirement benefits pursuant to Section 112.3173, Florida Statutes. The action was premised on the Petitioner's entry of a plea in a federal court proceeding wherein he had been charged with conspiracy to commit money laundering in violation of Title 18, United States Code, Section 371. On January 23, 2002, the Respondent afforded the Petitioner with a point of entry to challenge its decision and to request an administrative review of the issues.

On February 13, 2002, the Petitioner filed a request for an administrative hearing. Thereafter, the matter was forwarded to the Division of Administrative Hearings for formal proceedings. After continuances were requested and granted, the matter was ultimately heard on December 16, 2002. The Petitioner sought delays in the case presumably to attempt resolution of the matter through a related

federal proceeding. On October 28, 2002, the federal judge denied the Petitioner's motion to withdraw the guilty plea pertinent to the issues of this case. Accordingly, this matter went to hearing with the presumption that the Petitioner's plea, the genesis for the Board's action, was still valid.

At hearing the Petitioner presented testimony from Steven Chaykin. The Petitioner's Exhibits numbered 1-8, 10, and 11 were admitted into evidence. The Respondent's Exhibits 1-14 were also admitted into evidence. The Respondent requested and was granted official recognition of the matters addressed in the pleading filed May 10, 2002.

Further, the Pre-hearing Stipulation of the parties has also been fully considered.

The Transcript of the proceeding was filed with the Division of Administrative Hearings on January 22, 2003.

The parties requested and were granted 30 days leave to file Proposed Recommended Orders. Both parties timely filed such orders on February 17, 2003. The Proposed Recommended Orders have been fully considered in the preparation of this Recommended Order.

FINDINGS OF FACT

1. At all times material to the allegations of this case, the Respondent is charged with the responsibility of

   managing, governing, and administering the General Employees and Sanitation Employees' Retirement Trust Plan for the City of Miami (the Plan).

2. The Plan is a public retirement system as defined by Florida law. As such, the Respondent has deemed its action regarding the forfeiture of Petitioner's retirement benefits subject to administrative review.

3. The Petitioner was employed by the City of Miami (the City) on December 19, 1977. He served as a chief accountant and was later promoted during his tenure with the City. Ultimately he became Finance Director and Assistant City Manager on November 19, 1991.

4. In June of 1996 the Petitioner transferred the assets from his ICMA 401(a) Money Purchase Plan to the Respondent's Plan. The effective date of the Petitioner's participation in the Plan was May 26, 1996, as that was the date of the invitation to participate.

5. On September 9, 1996, the Petitioner retired from employment with the City.

6. On November 30, 2000, the Petitioner was charged with federal crimes. The events that formed the basis for the indictment occurred during the Petitioner's tenure as the Finance Director and Assistant City Manager. All such events predated the Petitioner's retirement.

7. All of the incidents complained of in the indictment related to the Petitioner's use of his employment position with the City. In fact, the indictment referred to the Petitioner's efforts to unlawfully enrich himself or another by the acts complained of in connection with the Petitioner's role with the City of Miami. More specifically, the indictment alleged that the Petitioner

   . . . used his position as City Finance Director to threaten to withhold payments due to Unisys Corporation for work the company had performed unless the company would agree to pay him a percentage of new contracts the company sought to obtain.

8. Count I of the indictment provided, in pertinent part:

   From in or about March, 1995, to on or about February 26, 1996, in Dade County, in the Southern District of Florida, and elsewhere, the defendants, MANOHAR SURANA AND PAMIT SURANA, knowingly and willfully combined, conspired and agreed with each other to commit offenses against the United States, that is:

   1. to extort money from Unisys Corporation under color of official right, in violation of Title 18, United States Code, Section 1951(a) and (b)(2);

   2. to solicit bribe money from Unisys Corporation, intending to be influenced in connection with business transactions of the City of Miami of value of $5,000 or more, in violation of Title 18, United States Code,

      Section 666(a)(B); and

   3. to launder money by transferring funds from a place in the United States to a place outside the United

      States, with intent to promote the carrying on of bribery and to conceal the nature, location, source, ownership, and control of the proceeds of said bribery, in violation of Title 18, United States Code, Section 1956(a)(2).

      
      

9. On May 18, 2001, the Petitioner entered a plea agreement wherein he acknowledged he would plead guilty to Count I of the indictment. Additionally, on August 26, 2001, the Petitioner appeared before the federal judge to formally enter a change of plea and to enter the plea as agreed.

10. Thereafter, in January of 2002, the Respondent received a report from its legal counsel recommending that the Petitioner's retirement benefits be deemed forfeited pursuant to Section 112.3173, Florida Statutes.

11. On January 18, 2002, the Respondent held a meeting at which time it voted to accept the report and deem the Petitioner's retirement benefits forfeited. Prior to the vote the Respondent considered comments from the Petitioner's counsel.

12. Upon notice from the Respondent of its decision, the Petitioner timely sought an administrative review of the matter and the case was forwarded to the Division of Administrative Hearings for formal proceedings.

13. While this matter was pending before the Division of Administrative Hearings, the Petitioner sought to set aside the guilty plea. By Order entered October 28, 2002, the federal judge denied the Petitioner's Motion to Withdraw Guilty Plea. The clerk of court was ordered to close the case.

    CONCLUSIONS OF LAW

    
    

14. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of these proceedings. Sections 112.3173(5) and 120.57, Florida Statutes.

15. Section 112.3173, Florida Statutes, provides:

    
    

    1. INTENT.–It is the intent of the Legislature to implement the provisions of s. 8(d), Art. II of the State Constitution.

    2. DEFINITIONS.–As used in this section, unless the context otherwise requires, the term:

       1. "Conviction" and "convicted" mean an adjudication of guilt by a court of competent jurisdiction; a plea of guilty or of nolo contendere; a jury verdict of guilty when adjudication of guilt is withheld and the accused is placed on probation; or a conviction by the Senate of an impeachable offense.

       2. "Court" means any state or federal court of competent jurisdiction which is exercising its jurisdiction to consider a proceeding involving the alleged commission of a specified offense.

       3. "Public officer or employee" means an officer or employee of any

          public body, political subdivision, or public instrumentality within the state.

       4. "Public retirement system" means any retirement system or plan to which the provisions of part VII of this chapter apply.

       5. "Specified offense" means:

          1. The committing, aiding, or abetting of an embezzlement of public funds;

          2. The committing, aiding, or abetting of any theft by a public officer or employee from his or her employer;

          3. Bribery in connection with the employment of a public officer or employee;

          4. Any felony specified in chapter 838, except ss. 838.15 and 838.16;

          5. The committing of an impeachable offense; or

          6. The committing of any felony by a public officer or employee who, willfully and with intent to defraud the public or the public agency for which the public officer or employee acts or in which he or she is employed of the right to receive the faithful performance of his or her duty as a public officer or employee, realizes or obtains, or attempts to realize or obtain, a profit, gain, or advantage for himself or herself or for some other person through the use or attempted use of the power, rights, privileges, duties, or position of his or her public office or employment position.

    3. FORFEITURE.–Any public officer or employee who is convicted of a specified offense committed prior to retirement, or whose office or employment is terminated by reason of his or her admitted commission, aid, or abetment of a specified offense, shall forfeit all rights and benefits under any public retirement system of

       which he or she is a member, except for the return of his or her accumulated contributions as of the date of termination.

    4. NOTICE.–

       1. The clerk of a court in which a proceeding involving a specified offense is being conducted against a public officer or employee shall furnish notice of the proceeding to the Commission on Ethics. Such notice is sufficient if it is in the form of a copy of the indictment, information, or other document containing the charges. In addition, if a verdict of guilty is returned by a jury or by the court trying the case without a jury, or a plea of guilty or of nolo contendere is entered in the court by the public officer or employee, the clerk shall furnish a copy thereof to the Commission on Ethics.

       2. The Secretary of the Senate shall

          furnish to the Commission on Ethics notice of any proceeding of impeachment being conducted by the Senate. In addition, if such trial results in conviction, the Secretary of the Senate shall furnish notice of the conviction to the commission.

       3. The employer of any member whose office or employment is terminated by reason of his or her admitted commission, aid, or abetment of a specified offense shall forward notice thereof to the commission.

       4. The Commission on Ethics shall forward any notice and any other document received by it pursuant to this subsection to the governing body of the public retirement system of which the public officer or employee is a member or from which the public officer or employee may be entitled to receive a benefit. When called on by the Commission on Ethics, the Department of Management Services shall assist the commission in

       identifying the appropriate public retirement system.

    5. FORFEITURE DETERMINATION.–

       1. Whenever the official or board responsible for paying benefits under a public retirement system receives notice pursuant to subsection (4), or otherwise has reason to believe that the rights and privileges of any person under such system are required to be forfeited under this section, such official or board shall give notice and hold a hearing in accordance with chapter 120 for the purpose of determining whether such rights and privileges are required to be forfeited. If the official or board determines that such rights and privileges are required to be forfeited, the official or board shall order such rights and privileges forfeited.

       2. Any order of forfeiture of

          retirement system rights and privileges is appealable to the district court of appeal.

       3. The payment of retirement benefits ordered forfeited, except payments drawn from nonemployer contributions to the retiree's account, shall be stayed pending an appeal as to a felony conviction. If such conviction is reversed, no retirement benefits shall be forfeited. If such conviction is affirmed, retirement benefits shall be forfeited as ordered in this section.

       4. If any person's rights and privileges under a public retirement system are forfeited pursuant to this section and that person has received benefits from the system in excess of his or her accumulated contributions, such person shall pay back to the system the amount of the benefits received in excess of his or her accumulated contributions. If he or she fails to pay back such amount, the

       official or board responsible for paying benefits pursuant to the retirement system or pension plan may bring an action in circuit court to recover such amount, plus court costs.

    6. FORFEITURE NONEXCLUSIVE.–

       1. The forfeiture of retirement rights and privileges pursuant to this section is supplemental to any other forfeiture requirements provided by law.

       2. This section does not preclude or otherwise limit the Commission on Ethics in conducting under authority of other law an independent investigation of a complaint which it may receive against a public officer or employee involving a specified offense.

       
       

16. In the instant case the Respondent must establish that the Petitioner has been convicted of a "specified offense" and should therefore forfeit his retirement benefits. It has met that burden.

17. A "specified offense" under the statute must have been committed by a public employee (not an issue herein); be a felony under Florida law (at issue), have been committed in a manner willfully and with the intent to defraud the public or the employing agency of the right to receive the public employee's faithful performance of his public duty (at issue), have been committed by the public employee in an attempt to obtain a profit or gain for himself or some other person (not at issue); and have been

    committed using the powers or duties of the public employee's position (at issue).

18. It is concluded that the Petitioner misused the powers or duties of his role as Finance Director and Assistant City Manager in an attempt to obtain a profit for himself or another person. Further, it is concluded that the Petitioner willfully and knowingly combined and conspired with others to perform the acts complained of in Count I of the indictment.

19. As to whether the "specified offense" is a felony under Florida law, it is determined that the standard set forth in Shields v. Smith, 404 So. 2d 1106 (Fla. 1st DCA 1981) applies to the instant matter. Under the Shields case a federally adjudicated crime can be the basis for the forfeiture of retirement benefits if the crime otherwise satisfies the criteria comparable to the state offense that would support a forfeiture. The elements of the relevant crimes are "matched" to make this determination.

20. In this case the Petitioner clearly pled guilty to a federal crime. That is not disputed. The crime was set forth as conspiracy to commit bribery, extortion, and money laundering in violation of Title 18, United States Code, Section 371. Thus the Respondent has established a "conviction" under the Florida forfeiture law.

21. Second, since the parties have stipulated that under the Shields test the conviction for conspiracy to commit extortion and bribery are not felonies under Florida law, those matters cannot trigger the forfeiture of the retirement benefits. Thus only conspiracy to commit money laundering (in this case involving $25,000) is at issue.

22. As to whether the conspiracy to commit money laundering criteria "match" up under the Shields test, it is concluded they do. The corresponding state law is set forth in Section 896.101(3), Florida Statutes. That section provides:

    (3) It is unlawful for a person:

    1. Knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, to conduct or attempt to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity:

       1. With the intent to promote the carrying on of specified unlawful activity; or

       2. Knowing that the transaction is designed in whole or in part:

          1. To conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity; or

          2. To avoid a transaction reporting requirement or money transmitters' registration requirement under state law.

    2. To transport or attempt to transport a monetary instrument or funds:

       1. With the intent to promote the carrying on of specified unlawful activity; or

       2. Knowing that the monetary instrument or funds involved in the transportation represent the proceeds of some form of unlawful activity and knowing that such transportation is designed in whole or in part:

          1. To conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity; or

          2. To avoid a transaction reporting requirement or money transmitters' registration requirement under state law.

    3. To conduct or attempt to conduct a financial transaction which involves property or proceeds which an investigative or law enforcement officer, or someone acting under such officer's direction, represents as being derived from, or as being used to conduct or facilitate, specified unlawful activity, when the person's conduct or attempted conduct is undertaken with the intent:

       1. To promote the carrying on of

          specified unlawful activity; or

       2. To conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds or property believed to be the proceeds of specified unlawful activity; or

       3. To avoid a transaction reporting requirement under state law.

    4. For the purposes of this subsection, "investigative or law enforcement officer" means any officer of the State of Florida or political subdivision thereof, of the United States, or of any other state or political subdivision thereof, who is empowered by law to conduct, on behalf of the government, investigations of,

    or to make arrests for, offenses enumerated in this subsection or similar federal offenses.

    
    

23. When the factual allegations of the indictment are considered, and the federal law is "matched," it is apparent that the instant case holds all elements needed to prove the Florida crime of money laundering. As the Petitioner admitted the allegations of the indictment within his plea (save that he acted for his own personal benefit, presumably he sought to benefit another person), it is evident he acted with knowledge of his offense.

24. Finally, as the amount of the conspiracy to money launder was greater than $20,000, the crime under Florida law would support the imposition of a punishment for a felony. Therefore, having concluded that the "specified offense" was committed by a public employee, that the acts complained of constitute a felony under Florida law and "match up" under the Shields test, that such acts were committed in a knowing and willful manner with the intent to defraud the public or the employing agency of the right to receive the public employee's faithful performance of his public duty, that such act was committed in an attempt to obtain a profit or gain for some other person, and that such acts were committed using the powers or duties of public

employment, the forfeiture of the Petitioner's retirement benefits must be upheld.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Respondent enter a final order affirming its decision to require the Petitioner to forfeit retirement benefits paid into the plan.

DONE AND ENTERED this 2nd day of April 2003, in Tallahassee, Leon County, Florida.

__________________________________

J. D. PARRISH Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847 www.doah.state.fl.us

Filed with the Clerk of the Division of Administrative Hearings this 2nd day of April 2003.

COPIES FURNISHED:

F. Philip Blank, Esquire Blank, Meenan & Smith P.A.

204 South Monroe Street Tallahassee, Florida 32301

Ira M. Elegant, Esquire Buchbinder & Elegant, P. A.

Commonwealth Building, Fourth Floor

46 Southwest First Street Miami, Florida 33130-1610

Sandra Elenberg Pension Administrator

City of Miami, General Employees' and Sanitation Employees' Retirement Trust

1000 Brickell Avenue, Suite 1010

Miami, Florida 33131

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within 15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the Pension Administrator, City of Miami, General Employees and Sanitation Employees Retirement Trust, that will issue the Final Order in this case.

Docket for Case No: 02-001060

Orders for Case No: 02-001060