Examining Rubio's Home Sale
(EDITOR'S NOTE: This story and video was originally posted on the CBS4 website on May 18, 2010. CBS4 News was the first to investigate the 2007 sale of Marco Rubio's home in Miami. It is now being re-posted following a series of statements and campaign ads by Donald Trump questioning the ethics of the home sale. )
-------------ORIGINAL REPORT-------------------
In 2007, Florida's no fault auto insurance law was set to expire. The law known as PIP – or personal injury protection – provides $10,000 in medical coverage for anyone in an auto accident.
Both Florida Governor Charlie Crist and the Florida Senate wanted to extend PIP. The only obstacle was the Florida House and its speaker, Marco Rubio, who believed PIP was rife with fraud and abuse.
"I started to study the issue and really became convinced that there was a serious fraud industry that had been built around it, largely through a combination of clinics and lawyers," Rubio said recently. "So I was okay with PIP being extended but only if we dealt with the fraud issues, at least some anti fraud measures."
Yet Rubio also gave the impression that he was willing to let PIP die.
"What I did obviously want was ultimate leverage and the threat that I was willing to let PIP go away," he recalled.
Among those who supported PIP were Florida chiropractors, including Dr. Mark Cereceda, who operates a string of pain clinics throughout South Florida. Cereceda's business depends on seeing PIP patients.
"I see a lot of PIP patients," Cereceda said.
In the Spring and Summer of 2007, Cereceda mounted a campaign to pressure Rubio to allow PIP to continue. Accompanied by other chiropractors, Cereceda met with Rubio in Tallahassee. Cereceda also organized marches and demonstrations in front of Rubio's West Miami office. He even hired four planes to fly banners over Rubio's home and office urging him to keep PIP alive.
Rubio, who described Cereceda as "an acquaintance," said he was aware of Cereceda's campaign and that he Cereceda "was pretty excited about that issue."
In the midst of all this lobbying, Mark Cereceda's mother bought a house from Rubio, paying $380,000 in an all cash deal that was finalized in April 2007. Rubio had originally purchased the house in 2003 for $175,000.
"It was just a coincidence," Mark Cereceda said of the sale.
Mark Cereceda, who lives on the same block as the Rubio house, said he noticed a "For Sale" sign in the front yard and recommended it to his mother.
Six months after the sale of the house was complete, Rubio wrote Gov. Crist a letter asking him to call a special session of the Florida Legislature. This time Rubio said he would support PIP.
"It had nothing to do with the house," Cereceda said.
Rubio said it was only after months of negotiations and significant reforms that he finally agreed to support PIP.
Included in those reforms was a fee schedule which limited the amount of money that could be paid for certain medical procedures. The new law also required pain clinics to be owned by actual doctors. And the law increased funding for fraud investigations.
Allen Genaldi, a special agent with the National Insurance Crime Bureau, said the reforms enacted by the Legislature had little effect.
"There were a few minor reforms to the PIP law but essentially it remained the same as it was prior to its sunset," Genaldi said.
Rubio agreed the reforms have not freed PIP from fraud.
"The only way you ultimately get rid of fraud is to prosecute the people committing it," Rubio said. "Certainly we wanted to make it less profitable to commit fraud and a little bit harder in terms of the accounting. I certainly feel the system is better than it was before."
He said his support of PIP had nothing to do with the sale of his house to Mark Cereceda's mother.
"She wanted to buy it because she wanted to live across the street from her son," Rubio said. "My understanding was her husband had passed away, she had some life insurance proceeds, that she was using to buy it and she was willing to close on it quickly."
A review of similar homes that were sold in that neighborhood during that time found the price that Nora Cereceda paid as being comparable to other sales.
Rubio said it never even occurred to him that selling his home to Nora Cereceda might raise questions.
"It was an arms length transaction, it was with her, we dealt with her and her trustee," Rubio said. "Certainly her son was a chiropractor and cared a lot about the issue but there were thousands of people all over Florida who were engaged in this issue on both sides of it. Fact of the matter was we sold it for a price that was comparable to other sales in the area, she wanted to buy it in order to live across the street from her son and three years later she still lives there and her son still lives across the street."
