ISLAMORADA -- One year after dozens of federal agents swooped down on his home and marina properties in an Internal Revenue Service-led raid, the tax fraud investigation into outgoing Islamorada Councilman Michael Reckwerdt continues.
"I'm simply doing my best to aid them in concluding their investigation," Reckwerdt said last week. "We are still sorting through our records to complete our filings. So our companies are doing our best to participate in the process."
Over the past several weeks, federal investigators have subpoenaed records of Reckwerdt's purchases from at least two Islamorada businesses. Trading Post owner Betsy Mooney and Uncle's Restaurant owner Joe Lapree both acknowledged that they received subpoenas but said they didn't want to go into the details.
"It specifically stated in the subpoena that I was not to discuss it, period," Mooney said last week. "I do not remotely have any idea what they're looking for."
Lapree said investigators were interested in Reckwerdt's credit card expenditures.
"It was a Christmas party, but that's as far as I want to elaborate," he said.
IRS agents were joined by counterparts from the FBI and the Bureau of Alcohol, Tobacco, Firearms and Explosives on the Nov. 3, 2011 raid that made headlines in South Florida. Agents that day seized paper records and computers from the Reckwerdt-owned Robbie's marinas on Lower Matecumbe Key and Stock Island. At the Lower Matecumbe marina, agents loaded several crates of documents into an awaiting U-Haul.
The United States Attorney's Office also got involved, convening a grand jury to investigate Reckwerdt, records obtained last January by the Free Press showed. At the time, Reckwerdt held the largely honorary position of Islamorada mayor. With his 8-1/2 year council tenure set to end due to term limits in November, Reckwerdt turned the mayor's gavel over to then-Vice Mayor Ken Philipson in late September.
Reckwerdt had gone four to five years without filing an individual tax return as of December 2010, he told attorneys in a divorce deposition at the time. His businesses were also in arrears to the IRS, he said in the deposition.
The IRS has consistently declined to comment on the Reckwerdt investigation. But the agency says on its website that due to their complex nature, financial investigations can take longer than a year.
The move by investigators to probe Reckwerdt's credit card records could mean they are looking for purchases that were improperly booked as business expenditures rather than personal ones, said Bill Parker, a Lower Matecumbe resident and private investigator who says he has worked similar tax cases around the country as a U.S. Justice Department contractor.
"Usually these cases are triggered by financial transactions, or most likely, informants," Parker said. "Understand, informants can get a bounty on the information."
Parker added that he would expect the investigation to be concluded within the next six months, or a year at the longest.
"It's clumsy and unrealistic to continue a grand jury target for two to three years, so it's got to come to an end soon," he said.