By Kevin Deutsch
Tamarac City Manager Michael Cernech was arrested Friday for his role in a scheme to extort more than $3 million from a Florida developer, prosecutors said.
Following an investigation by the Florida Department of Law Enforcement, state Attorney General Ashley Moody’s Office of Statewide Prosecution charged Cernech with conspiracy to commit racketeering for his role in attempting to extort $3.4 million from 13th Floor Investments, doing business as SPL Holdings, according to Moody’s office.
Cernech, who lives in Parkland, is an alleged co-conspirator to father-and-son duo Bruce and Shawn Chait in the extortion scheme, according to prosecutors.
He surrendered to the Broward Main Jail Friday afternoon, prosecutors said and was being held on a $200,000 bond.
“The defendant conspired with convicted felons, using his position of authority to relay false information to the highest levels of city government to further this multimillion-dollar extortion scheme—disgraceful,” Moody said. “My statewide prosecutors, working with FDLE investigators, have exposed the corruption, and now the defendant and his co-conspirators will have to answer for their crimes.”
FDLE Commissioner Rick Swearingen said the victim in the case “was constantly harassed and his business and livelihood threatened by the Chaits and their accomplice Michael Cernech.”
“Their actions were both frightening and appalling,” Swearingen said.
FDLE agents said Bruce and Shawn Chait, along with co-conspirators John Colonel, Harris Shapiro, and others—including Cernech—harassed, extorted, and threatened 13th Floor Investments over property acquired after the Chaits defaulted on a loan more than a decade ago.
The victim’s business has since developed the land for residential housing, according to prosecutors.
Cernech’s role in the conspiracy includes assisting the Chaits in pressuring the victim into paying $3.4 million by leaking false information to both Tamarac’s mayor as well as to attorneys representing 13th Floor Investments, prosecutors said.
According to Moody’s office, text messages between Cernech and the Chaits confirm Cernech’s role in the conspiracy.
After Cernech put further pressure on the victim, the Chaits complimented him for his actions by referring to Cernech as a “total game-changer, amazing and a magician,” Moody’s office said.
The investigation “verified Cernech’s awareness that the Chaits and co-conspirators continuously threatened, and falsely claimed, the presence of dangerous levels of soil contamination on the property,” prosecutors said.
The Chaits and co-conspirators bolstered their false claims by filing lawsuits using straw plaintiffs as “puppets for the sole purpose of getting the victim to pay,” prosecutors said.
“The Chaits used the false claim as leverage, knowing that the victim would not want to have his reputation tarnished—even through false accusations and bogus threats of lawsuits,” Moody’s office said.
In the late 2000s, the Chait’s owned Prestige Homes of South Florida and were accused of bribing local officials to gain the approval of a development on a Tamarac golf course. In 2011 and 2014, Gov. Rick Scott suspended Tamarac Mayor Beth Flansbaum-Talabisco after being charged with unlawful compensation, bribery, official misconduct, and conspiracy to commit unlawful compensation connection with the Chait’s. She was found not guilty by a jury.
In 2010, Tamarac Commissioner Patte Atkins-Grad was arrested for not reporting payments from Chaits to lease a BMW and pay for her election victory party and not disclose them. She was also found not guilty by a jury.
Former Broward County Commissioner Josephus Eggelletion served 2 years in prison after admitting to accepting $28,200 in bribes from the Chaits and voting to support their proposed residential development. This included a $3,200 membership to the Parkland Golf and County Club.
In the extortion of 13th Floor Investments, the Chaits sent multiple anonymous letters to county officials, including to Broward County Environmental Protection employees, with fraudulent claims about soil contamination at the property, prosecutors said.
In recordings, the Chaits admitted to orchestrating the lawsuits and using the soil contamination claims solely for the purpose of getting the victim to pay, prosecutors said.
According to Moody’s office, the Chaits demanded more than $3 million from the victim to make the lawsuits and harassment “go away.”
“Cernech’s position with the City of Tamarac and willingness to participate in the scheme proved a valuable asset to the Chaits,” her office said.
In 2019, Cernech was chosen for the top job leading Delray Beach; however, they could not come to an agreement, and he stayed with the City of Tamarac.
Besides his experience in city management, Cernech holds a bachelor’s degree in finance from the University of Detroit and a master’s degree in public administration from Trinity University. He has also attended the Harvard University Kennedy School of Government.
Cernech sits on the Florida City/County Management’s Association (FCCMA) Board of Directors for District 5 and was newly appointed secretary/treasurer. He also recently served three terms as secretary/treasurer of the Broward City-County Management Association (BCCMA).
Cernech’s colleague, Tamarac Vice Mayor Elvin Villalobos, was floored by the news of his arrest.
Referencing the Chaits’ earlier corruption, Villalobos said, “anything involving [the developer team] is not good,” based on “their previous history with Tamarac and other cities.”
“I told the city manager I’m going to be praying for him and his family, and that ‘this too shall pass,’” Villalobos said.
“It’s a little bit heartbreaking…it’s a shame.”
The vice mayor said, “we don’t know exactly what happened,” and that all the facts are not yet available.
“It’s another blow to the city,” he said. “But we’re going to get through this.”
In a written statement, Tamarac Commissioner Mike Gelin said it was “disappointing that the city manager was arrested for conspiring with these known convicted criminals, who played a significant role in the arrest and charges of three former Tamarac City Commissioners.”
“It is my prayer and hope, for the sake of the residents, staff, and City, that we can deal with this issue expeditiously and move forward with our focus on making Tamarac the best that it can be,” Gelin said. “I have already requested a special meeting through the City Clerk. We will make it through this difficult patch together, as one community.”
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- Kevin Deutsch is an award-winning crime journalist and author. A graduate of Florida International University, Kevin has worked on staff at The Miami Herald, New York Daily News, and The Palm Beach Post.