Entries in Essex County Democrat Party Boss Joe DiVincenzo (1)

Wednesday
Oct102018

Why is the Grease machine picking who’s who in the media?

There’s an old saying among machine politicians in Philadelphia.  It goes like this, “If you say you’re the boss, and nobody says you aint the boss, then you’re the boss.”

John F.X. Graham probably heard it back in the day, when he was prowling around amongst the ward healers in that sainted city of brotherly love.  Back when “ethnic” meant second or third generation Irish or Polish or Italian and individual neighborhoods developed their own dialects (yes, people really did talk like Rocky back then).

John F. X. moved to New Jersey where he followed the yellow brick road of selling insurance to government entities.  Unlike South Jersey’s George Norcross, John F. X. wasn’t really interested in building a political machine.  He was content with a money machine – the old-fashioned kind, the grease machine that uses campaign contributions to lube the representatives of the taxpayers, so that their money pumps out in a nice, steady stream.

Last December, the Observer wrote about John F.X. and his operation – the Fairview Insurance Agency – in a “special report” about “How Insurance Brokers Reap Public Funds Without Disclosure.”  It makes for interesting reading:

Insurance brokerages that make political donations are declining to disclose large amounts of money received indirectly from public entities.

One of the biggest goldmines for contractors in New Jersey is selling insurance plans to public entities, which employ hundreds of thousands of workers across the state.

But an Observer review of dozens of public documents shows that in some cases, it’s difficult or impossible to get a complete accounting of the money going back and forth between insurance brokerages — some of which are deep-pocketed campaign donors — and the public entities that award lucrative insurance contracts. 

For instance, Fairview Insurance Agency Associates is one of the largest political donors in New Jersey, giving more than $120,000 to various candidates and committees in 2016, the ninth-highest among businesses in the state, according to the state’s campaign finance watchdog agency.

The Verona-based brokerage is also a big contractor, raking in at least $1.1 million through public contracts or agreements across New Jersey in 2016.

Under state law, the firm is required to report annually all of its political donations and public contracts to the Election Law Enforcement Commission, provided it gets at least $50,000 in public contracts and makes at least one political donation of any amount. Curiously, however, some of the money Fairview gets indirectly from public entities is then reported to ELEC as $0.

The effect is that, to the average observer reading ELEC reports, Fairview would appear to have made much less from public entities and institutions than it actually got — directly and indirectly — in a given year.

Observer reviewed ELEC disclosures for five companies, only three of which were required to itemize their contracts and donations.

A review of six ELEC disclosure forms, 29 invoices, four contracts and eight resolutions by school boards and local councils revealed a loophole in state law that allows brokerages such as Fairview to not report to ELEC tens of thousands of dollars, or more, that they receive as a result of working for governments or public entities. 

In 93 cases, three brokerages reported receiving $0 from public agreements in 2016 on their disclosure forms filed with ELEC...  In one case, Observer found that Fairview was paid $54,000 indirectly from Jersey City’s school board but later disclosed $0 to ELEC.

It works like this. Brokerages — which sell insurance plans to local governments — are often paid commissions or fees by third-party companies. In this scenario, the actual contract does not go to the brokerage, but to the third-party company, while the brokerage still gets a cut of the business. 

In some cases, the dollar amount of these fees or commissions can be traced back by filing public records requests with local governments. Some public entities that answered such requests from Observer provided copies of the original public contracts, which in turn detailed the actual fees or commissions paid to insurance brokerages that were reported to ELEC as $0.

In other cases, there is no mechanism to piece together what a third-party company paid to a brokerage in commissions. Some public entities did not disclose or could not say how much their brokers were paid indirectly by their contractors.

In March 2015, the Jersey City Board of Education passed a resolution to award Fairview a $54,000 contract to be the school district’s prescription insurance broker for fiscal year 2016.

Fairview did not end up receiving an actual contract. The school board struck a deal two months later with Express Scripts to manage its prescription benefits plan, and in that contract, it directed Express Scripts to pay Fairview $4,500 per month on its behalf, according to a copy of the contract provided by the Jersey City school board. The school district essentially paid someone else to pay Fairview.

In the end, Fairview reported that it received $0 in 2015 and 2016 from its work for the Jersey City Board of Education, according to its annual reports filed with ELEC. The firm noted that the amounts it disclosed “do not include commissions received from the insurance carriers.” (Observer, December 6, 2017) 

Campaign contributions flowing one-way, huge contracts flowing the other… minimal to no transparency. That’s New Jersey.

The problem is… the Fairview Insurance Agency owns the news agency (InsiderNJ) that just handed out the designations as to who is who in New Jersey media. 

Yep, there’s John F. X. Graham who owns both the Fairview Insurance Agency and InsiderNJ (he holds titles of founder and publisher, respectively).  Michael J. Graham is Chief Operating Officer of both the Fairview Insurance Agency and InsiderNJ.  Ryan Graham is the Director of Business Development for the Fairview Insurance Agency and the Associate Publisher of InsiderNJ. 

That’s it folks… John F.X.’s grease machine has its own media mouthpiece with which to skew perceptions.  And that’s a handy thing to have in an age of hollowed out local coverage and a dearth of what was once called “investigative journalism.”  The press is now routinely used to punish the whistleblower, the taxpayer advocate, citizen activist, the underdog.  It’s easy to see why.

Now don’t get us wrong, just because John F.X. is all about the money… and the money… and the money… and the money… That doesn’t mean he’s not above playing the part of the noble, the enlightened, crony capitalist.  Hey, didn’t some notorious mob boss put a roof on a church?  Doesn’t Johnson & Johnson make up for failing to warn women that their product could cause uterine cancer by being oh so woke on LGBTQ?  It pays to have fashionable connections and to assist those connections in the higher causes of fashion.

John F.X. is a friend of Hillary.  Yes, that old wind bag.  You could forgive him being a friend of Bill because, heck, who wouldn’t want a night out on the town with Bill Clinton?  He’d make a Saturday night seem like a month of weekends.  But Hillary?  You know that’s just fashion. 

Nevertheless, John F.X. has been called “a top Democrat fundraiser” by newspapers like the Bergen Record and the Newark Star-Ledger.  In addition to Hillary Clinton, John F.X. raised money for John Kerry in his 2004 presidential race, and he’s been a big giver to United States Senator Bob Menendez.  In fact, it was John F.X. who pushed the idea of Menendez on a national ticket as vice president:

In January 2008, the Jersey Journal along with other media outlets reported that “John F.X. Graham, one of Hillary Clinton’s National Finance Co-Chairs, thinks that New Jersey Senator Robert Menendez would make a great choice if Clinton wins the Democratic Primary… Graham fired off an email this morning to Clinton Campaign Manager Terry McAuliffe listing politicians who would make good vice presidential material, including the choices most often brought up:  Barack Obama, Bill Richardson, John Edwards and Joe Biden.  But Menendez, a Clinton campaign national co-chair, would be the “most intriguing” choice, Graham wrote.”

“The name Richardson does not sound exactly Latino,” wrote Graham.  “The Latino voting block is becoming the most influential in this election, especially with the immigration and other economic issues confronting our prosperity.  For lack of a better term, he is the Latino Barack Obama with the experience.” 

Why would John F.X. think that encouraging people to vote along racial or ethnic lines is good public policy?  Has he not heard of the former Yugoslavia? 

Finally, John F.X. made his pronouncements while Senator Menendez was the subject of an FBI investigation.  Not that something like that matters when you are making a fashion statement.

Yes, so it seems that InsiderNJ can also be considered an outpost of the far-flung Clinton Empire.  Ahhhh, corruption at its most tasty. 

And it looks as though John F.X. is quite a big deal.  Even Wikileaks picked up loads of correspondence between John F.X. and his fellow Clintonistas.  Here is an example:

As far as the money goes, national contacts and a national reach does have its advantages.  We found dozens of John F.X.’s insurance agency’s outposts around the country.  All making him money – but northern New Jersey and Essex County in particular is his base.  It was reported in Politico (November 24, 2014) that Essex County Democrat Party boss Joe DiVincenzo’s son worked for John F.X.’s insurance agency.  He also held a full-time public job as well. 

So it was no surprise that the most corrupt political machine in the state – the Essex County Democrats – inducted John F.X. into their “Hall of Fame” in March of 2015.  InsiderNJ editor, Max Pizarro wrote the panegyric, which we suppose was less messy than the alternative. 

Now can we ask this again?  What are these people doing handing out the rankings on New Jersey journalists?  Shouldn’t some organization, like the Society of Professional Journalists, be doing it?  Or the Columbia School of Journalism?  Or anything but the god-damned grease machine itself!

Ten years ago, the authors of The Soprano State – two old-school investigative journalists – joined with journalists like Josh Margolin to decry the corruption tax that added to the cost paid by New Jersey taxpayers on everything to do with government.  Could they have guessed that, ten years later, not only would the tax be more imbedded and less transparent, but that the very news agencies responsible for exposing and reporting on it would now be wholly-owned subsidiaries of the same grease machine responsible for the corruption?

New Jersey… you can’t make this stuff up.