I-Team: Fox represented both sides in loans

New building permits are taped to the window of 276 Westminster St. in downtown Providence. It's yet another business coming into a space that's been a revolving door of theaters, bars and cafes.

Loans are what keeps business flowing in the heart of the city, but some of those handouts appear questionable.

The NBC 10 I-Team asked the Providence Economic Development Partnership to turn over a list of documents. The paperwork showed dozens of connections to former House Speaker Gordon Fox.

A bar on Union Street used to be a place called Fatty McGee's. Its owner in 2006 was David Sepulveda. He got a city-backed loan for $70,000. Fox was his lawyer, and Fox also worked on the loan as the closing attorney for the PEDP.

Fox got paid on both ends of the loan, and after the bar got its money, Fox's name disappeared from the official business filings with the secretary of state and was replaced by Sepulveda's.

The bar still owes taxpayers $49,221.

Alex Tomasso is connected to at least three PEDP loans, including Fatty McGee's. Tomasso pleaded no contest in 2000 to criminal solicitation and possession of cocaine. He's also a former business partner of Fox, and Fox was his lawyer on other ventures. Tomasso's Providence bar on Throop Alley eventually closed up shop, too. He's still on the hook for $24,249 in this one location.

The relationships show Fox, the lawyer working for his client on one hand -- and on the other, he's closing loans for the city on behalf of those same clients who just received a lot of federal money.

Michael Van Leesten is the president of the Van Leesten Group, a construction and real estate development company in Providence. In 2009, he got a PEDP loan for $20,000. His lawyer was Fox.

In 2005, Van Leesten was president of the Providence Black Repertory Company, according to state records. Fox wasn't the theater's attorney but closed a $400,000 loan for the nonprofit and earned $3,339 himself for handling the transaction. By 2011 the theater was gone. It would take years before the loan was settled with the sale of the building.

"I never received one penny as chairman of the board of the Black Repertory Company," said Van Leesten. "It went belly up."

Van Leesten denies any favors were traded.

"I'm not trying to deny my relationship with Gordon, but I don't know specifically the role that he played in the documents that went on down at the Providence Economic Development office," Van Leesten said.

Van Leesten said he never discussed loans with Fox.

The close relationships between the former speaker and these business owners flew under the radar for years. Fox wasn't registered as a city vendor until 2010. This year, he was fined by the Rhode Island Ethics Commission for not reporting some $40,000 in income he received from the PEDP. It's unclear just how much money he earned while working as a subcontractor to PEDP lawyer Josh Teverow from 2005 to 2010.

But the I-Team found Fox's name and old law office address listed on at least 57 loan documents filed with the Rhode Island secretary of state during that time period.

A search of campaign finance records showed Sepulveda donated $150 to Fox in 2005. Van Leesten donated $1,350 from a period of 2006 to 2008. Tomasso contributed $2,025 from 2003 to 2009.

Fox did not return a call for comment.