Suspicious Refunds in Gandhi's Tax Tenure

"Based on the recent briefings the mayor has received, he believes that Dr. Gandhi's overall record justifies his view that it is in the best interest of the District of Columbia for him to remain as CFO," said Fenty's spokeswoman, Carrie Brooks.

The Post looked for the same warning signs cited by an FBI agent in an affidavit outlining the criminal case. They include the absence of court orders, which the FBI says are typically required for legitimate property tax refunds, and the use of company names that were slight variations of real businesses.

None of the 15 checks in question was authorized by a court order resulting from an assessment appeal.

The largest of the checks was for $363,382 in March 2000 to Quadrangle Development, a large commercial property owner and downtown developer.

Attorneys for Quadrangle said they could not find any records yesterday showing that their client received such a check or even won a tax appeal in that time frame.

For the tax office, Oct. 18, 1999, was an especially busy day. Four refund checks were issued that lacked court authorization: $257,287 to Greyrock Capital Group, $229,721 to 254 Limited Partnership, $57,026 to Avenue Associates and $75,099 to Associates of Cummunity Tse. The latter two were among the companies The Post determined do not exist.

Representatives of four companies with similar names and agents said yesterday that they could find no record of receiving such checks.

The check written to Associates of Cummunity Tse stunned officials at an actual group with a similar name: the Association of Community College Trustees. The lawyer listed in the city tax office as having received the refund said he once worked for the real association, but not since 1998.

The association's current lawyer said the group did appeal its taxes and win a legitimate refund -- three years earlier, in 1996. The president of the organization said his predecessor received a refund check for $75,099 in May 1996, and he said internal records show the organization cashed it days later.

The president, Noah Brown, said he and the association's attorneys were immediately suspicious when told by The Post that the city records showed that the tax office has paid the group the same refund twice.

"I am shocked that somebody would have tried to use our association's name to perpetrate fraud, particularly to perpetrate fraud on the public," Brown said. "In a personal note, I find it disturbing because I was a taxpayer and resident of the District for 16 years. It makes you wonder what else happened in city government that you will still uncover."

On another busy day, Feb. 17, 2000, the tax office approved three refund checks totaling $296,500. None of the checks matched a list of court-ordered payments related to assessment appeals. None of the property listings on those three checks matched properties owned by the payees listed on the checks.

The first check was written to Assoc, General Contractors for $58,014.20. In fact, the Associated General Contractors appealed a property tax assessment, won the appeal and received a refund one year earlier for a slightly larger amount. Officials at the organization said their records did not reflect any payment in 2000, and the subsequent check is a mystery to them.

The second refund check the tax office wrote that day was to 1625 Mass Ave Corporation for $113,412.50, city records show. The company actually owned a commercial building at the location for which it is named, but the refund check listed an unrelated property on Cathedral Avenue.

The third check was to Capital Square Homes for $125,102.24. That appears to be a misspelled version of Capitol Square Homes, a partnership of Eakin/Youngentob Associates that developed townhomes on Capitol Hill. The company's chief financial officer said he checked the company's records and found no tax refund from the city in that amount or in that time frame.

"We sure would hope the systems would be there to stop this kind of thing from happening," said Terry Eakin, one of the group's founding partners.

Staff writers David Nakamura and Nikita Stewart and staff researcher Meg Smith contributed to this report.