Chippendale Blasts Criminal Investigation of Corso and 38 Studios
Kate Nagle, GoLocal
Chippendale Blasts Criminal Investigation of Corso and 38 Studios
House Oversight Committee Chairman Representative Michael Chippendale (R, Foster-Coventry-Glocester) had blasted the criminal investigation into both Michael Corso and 38 Studios, in light of documents reviewed by Chippendale showing that Corso was getting millions from contracts of the failed video game company.
"We just acquired these docs...I don't believe anyone's looking into the criminal side of things, and an [Attorney General] who's not," said Chippendale. "We had a contractor blow things wide [open]," referring to the recent revelation by a former 38 Studios subcontractor that 38 studios funds went towards rehabbing Corso's bar and restaurant, Tazza
Chippendale, who was said he has received death threats since heading up the investigation into 38 Studios, spoke to the information contained in bankruptcy filings for 38 Studios on Delaware, where the company had been Incorporated.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLAST"We have a situation where Corso had quite a deal," Chippendale said of the former 38 lawyer and lobbyist. "We found that he had three contracts with 38 [Studios], and the lobbying one for 300K -- and an other one I haven't quite figured out -- we're matching those up."
Regarding the information contained in the 38 Studios Chapter 7 liquidation documents, Chippendale said, "One of the interesting things is the way it was described, [Schilling] wouldn't know the difference between an armadillo and a dollar. He had no concept how quickly they were bleeding money."
Corso's Millions
Chippendale spoke to three contracts Corso executed through his Kingston Capital Group, Preservation Credit Fund, and Orb Development that enabled him to arrange the take through a piece of development costs and financing.
Orb, LLC Contract with 10 Percent Development Fee Provision
Preservation Fund Tax Credits Rights
Kingston Capital 9.5% Financing "Success" Fee
"Corso had it set up sweet," said Chippendale. "He ran it through Zaccagnino," referring to Thomas Zaccagnino, the former 38 Studios Vice Chair and Board Director. "Zaccagnino gets Schilling's trust years ago, and leverages it to get [Schilling] in touch with Corso."
"There's [one] email from Zaccagnino to everyone in EDC, the bond counsel, everyone who was involved, around March of 2010," said Chippendale. "Zaccagnino orders everyone, via e-mail "Make sure you CC Corso on everything". That was telling to us, and we couldn't back up until we had this info."
"We know that the gig was going one way, and Corso was getting 9.5% on the way out," said Chipppendale. "We know that he got a lump some of over $225,000 for being their lobbyist."
"This all hinges on Corso...Corso's the one make the money," said Chippendale. "We that 9.5% of every dollar 38 spent in vendor [costs] towards build out would go towards him. We know the build out was over $12 million,he got at least $1.2 million there."
First 38 Payment Called Into Question
"The $1.1 million where the check had bounced (Schilling) that started everything -- there's in no trace of who paid the $1.1 million," said Chippendale of the infamous check that bounced in May 2012. "No one has credit."
"Chafee's office will not talk to us about that. We know that money was paid -- it was the last ditch effort to salvage tax credit," said Chippendale. "Our suspicion is that [it's] Zaccagnino or Corso, one or both of them."
INVESTIGATION: Fox, Corso and 38 Studios
The Early Years
Early 2000s
Fox was emerging as a powerful leader in the House via his role on the Finance Committee and later as Finance Committee Chair. Corso served on the management team at developer's Buff Chace's Cornish Associates.
The two worked together to write and pass the Historic Tax Credit Legislation.
Bio attached from the early 2000's - Cornish Assoicates Website.
Insiders
Insiders Had Hands All Over Schilling’s 38 Studios Deal
The owner of the construction company that was awarded a contract to work on the interior of 38 Studios’ downtown headquarters has close ties to House leadership and other prominent local politicians, GoLocalProv has learned.
Steven Nappa, who owns Nappa Construction Management, has contributed over $16,000 over the last decade to top politicians including House Speaker Gordon Fox, Congressman and former Providence Mayor David Cicilline, Providence Mayor Angel Taveras, former House Speaker William Murphy and former House Finance chairman Steven Costantino. In June 2011, Nappa also contributed $1,000 to the Fund for Democratic Priorities, a political action committee maintained by House leadership.
Nappa is also connected with Michael Corso, a Providence lawyer who has made a fortune helping to sell state tax credits and was involved in the earliest meetings between Schilling and Rhode Island officials. The two hosted a private fundraiser at the Peerless Lofts for then-Majority Leader Fox in 2007. Nappa also helped build the movie screen located in the open space next to Tazza, the downtown café owned by Corso.
Corso himself has contributed $11,625 to Fox, Cicilline, Taveras, Murphy and other local politicians in recent years.
Movie Tax Credits
Corso and Movie Tax Credits
The Providence lawyer who pledged more than $14 million in Rhode Island motion picture tax credits that had not actually been issued as collateral in order to obtain an $8.5 million loan for Curt Schilling’s 38 Studios is now playing a behind-the-scenes role in a Michael Corrente movie that is slated to receive $625,000 in state tax credits, GoLocalProv has learned.
Michael Corso, a top tax credit broker whose loan agreement with BankRI is among several 38 Studios-related matters currently being investigated by state and federal authorities, is one of seven producers for “Backmask,” a horror film currently being shot in Exeter, according to IMDB. Corso’s business partner, Anthony Gudas, is listed as the executive producer and former State Rep. John Loughlin has a small role in the film.
On Monday, the Rhode Island Film and TV Office confirmed the film has received an “Initial Certification Letter” for the tax credits. Corso did not respond to a request for comment.
Tazza Fundraiser
Questions Surround Speaker Fox’s Relationship with 38 Studios Insider
Several weeks after initial inquiries from GoLocalProv, House Speaker Gordon Fox still isn’t answering questions about a 2007 fundraiser held for him by the lawyer who would play a pivotal role in bringing Curt Schilling’s 38 Studios to Rhode Island three years later.
In March 2007, Michael Corso, Steven Nappa and Robert Britto of Nappa Building Corp. and former State Representative Ray Rickman were listed as the hosts of a private fundraiser held in the Peerless Lofts for the then-Majority Leader. The event, which helped Fox rake in approximately $10,000, was catered by Tazza, the downtown café owned by Corso.
But while Fox’s campaign finance reports from the time include details about several other fundraising events held during the first quarter of 2007, there is no information listed about expenses incurred for the Corso-hosted event, which may constitute a campaign finance violation.
“Speaker Fox has been extremely busy entering the final two weeks of the session, but he will soon be checking the campaign records from five years ago,” Fox spokesman Larry Berman told GoLocalProv on June 4. “If corrections are necessary to the report, he will make them.”
Fox and Corso
38 Studios Insiders Have Been Connected Since May 2009
The lawyer at the center of the deal that brought Curt Schilling’s 38 Studios to Rhode Island had a business relationship with a top executive at the video game company a year before a piece of legislation that expanded the EDC’s Job Creation Guaranty Program was pushed rapidly through the General Assembly.
On May 29, 2009, Michael Corso, a top tax credit broker whose relationship with House Speaker Gordon Fox helped steer 38 Studios to the Ocean State, struck a deal to purchase credits handed out for the multi-million dollar Stone House hotel project in Little Compton from the Round Pond Management Corporation, whose President was Tom Zaccagnino.
By June of that year, Zaccagnino, who was also the co-managing director at the Wellesley Advisors Corporation in Maynard, MA, had become Vice Chairman and Lead Director of 38 Studios. A month later, Haymarket Capital, an LLC with the same address as the Wellesley Advisors Corporation, was involved with the seven-figure bridge loan a group of Rhode Island investors provided to 38 Studios.
In March of 2010, Zaccagnino and Schilling met with Speaker Fox and former EDC director Keith Stokes in Corso’s downtown law office. By May, the General Assembly had expanded the EDC’s loan guarantee fund from $50 million to $125 million, the exact amount the EDC awarded to 38 Studios later that summer.
Crony's Bar
38 Studios Contractor Ordered to Install Equipment in Fox’s Crony’s Bar
Galasso
Rhode Island Cartoonist Takes Aim on Fox and Corso
In the midst of Gordon Fox's 2012 re-election effort, he distanced himself from his longtime friend, Mike Corso.
Rhode Island's iconic catoonist took aim at Fox's claim and artfully tied Corso and Fox together.
