Rhode Island Secretary of State Ralph Mollis intends to seek a steeper fine against lawyer Michael Corso should Corso not report his 2010 lobbying on behalf of the 38 Studios financing bill.
Hearing officer Louis DeSimone, whom Mollis hired, ruled that Corso, a tax credit broker, wrongly lobbied on behalf of former Boston Red Sox pitcher Curt Schilling's video-game company, whose bankruptcy and failure in 2012 left state taxpayers on the hook for a loan guarantee on $75 million in bonds.
"It is apparent that there was some effort expended by the respondent in lobbying for a change to the 'jobs creation bill' present before the legislature," DeSimone said in a six-page report he released Friday afternoon. "To suggest that lobbying did not occur in the addition of $75 million dollars would seem unlikely at best."
Corso has until Thursday to file "all necessary lobbying reports for 2010 commencing in March through termination of the legislative term," according to DeSimone.
Mollis said that before he adopts DeSimone's findings, as state law requires, he would ask DeSimone to clarify why the maximum fine is $2,000. "While I understand R.I. General Law caps the fine at $2,000 per violation, I will be asking for clarification on 'per violation' while also asking if additional fines can be levied due to executive lobbying," Mollis said in a statement.
Corso's lawyers, in a statement, called the findings "without any factual or legal support." They accused Mollis, who ran unsuccessfully for lieutenant governor, of political motivation.
The Rhode Island Economic Development Corp. - now Rhode Island Commerce Corp. - issued Schilling's company a $75 million loan guarantee, backed by the state's moral obligation, to move the company to Rhode Island from Massachusetts and complete the multiplayer online video game "Copernicus." The state's economic development arm was the official issuer of the bond debt.
Though Rhode Island paid on the debt the past two years after threats of downgrades from bond-rating agencies, though lawmaker debate over whether to pay it has been heated.
Corso was a political ally of former House Speaker Gordon Fox, who resigned his leadership post in March after law enforcement officials raided his State House office and Providence home. Fox did not seek re-election. His attorney, Albin Moser, said in May that a grand jury investigation may include the 38 Studios financing.
The saga has included accusations of insider trading by Rhode Island bondholder and former congressional candidate Michael Riley, and threats against two state representatives Karen MacBeth, D-Cumberland, and Michael Chippendale, R-Foster, warning them to "stop poking around."
