Cuomo Sues Espada and Son for Abusive Labor Practices

By Melissa Russo and Katie Honan
|  Wednesday, Apr 28, 2010  |  Updated 8:55 PM EDT
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<a title=New York's Attorney General's investigation into State Senator Pedro Espada widens." />

New York's Attorney General's investigation into State Senator Pedro Espada widens.

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Investigators Raid Espada's Bronx Clinic

State Senate Majority Leader Pedro Espada is attacking Attorney General Andrew Cuomo for spreading politically motivated lies. This as Federal and State investigators raided Espada's non profit health clinics today in what is now a criminal investigation by the AG, the FBI and the US Attorney's office.

Investigators Pull Files from Espada's Nonprofit

State and federal officials pull documents from Sen. Pedro Espada's nonprofit.
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One week after charging Senator Pedro Espada with siphoning more than $14 million from his Bronx-based non-profit, Attorney General Andrew Cuomo slapped a new lawsuit against the Senate Majority Leader and his son, Pedro G. Espada, for violating labor laws.

Cuomo says the embattled state legislator cheated workers hired to do janitorial work at the healthcare provider at the center of the alleged swindle.

This latest lawsuit, to be announced at a press conference this afternoon, alleges that the Espadas devised and operated a sham job training program to minimize costs and maximize profits at Espada Management -- the family-owned, for-profit management company created to perform janitorial services at Soundview HealthCare Center, the Bronx-based not-for-profit that, authorities say,  is at the center of Espada's alleged fraud.

The money flowed from Soundview to Espada Management, run by Pedro G. Espada, by means of a contractual arrangement that called for Espada Management to supply janitors for the Soundview medical clinics. 

The program mischaracterized workers as trainees who were then paid wages that were far below what New York State law requires. 

“This was a sham job training program pure and simple with workers receiving no training and getting virtually no jobs,” said Attorney General Cuomo. “Espada ripped off his own community in order to maximize the amount of money he could siphon out of the Soundview clinic, according to our complaint." 

Cuomo said the workers were paid less than the law requires, some about $1.70 an hour. He says at least 100 workers have been victimized since 2005.

The state minimum wage is $7.25 an hour.

Sen. Espada called the latest lawsuit a further attempt at "political assassination" and denies running a sham job training program.

He said the two-week training program pays a stipend, and some workers move up to earn good wages.

Espada was accused last week of looting Soundview to the tune of $14 million over five years. He's also accused of packing the Soundview board with friends, family members and people who relied on him, including Senate employees.   

Those board members are accused of signing off on exorbitant perks for Espada, including a housing allowance, tens of thousands of dollars in meals and a 9 million dollars severance package. 

Investigators tell NBCNewYork.com one question is whether Espada may have rewarded board members with government jobs in return for signing off on those perks.

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