Judge Orders Transfer of Cultural Center

January 28, 2013 by · 1 Comment 

Editor’s note: This is an updated version of an earlier story.

A famed Boyle Heights community landmark that once served as a non-profit cultural and civic institution for Mexican immigrants is now in the hands of a community-based non-profit developer, a transfer ordered by a Los Angeles County Superior Court judge.

As the new stewards of La Casa del Mexicano, the East Los Angeles Community Corporation (ELACC) plans to assess the building’s integrity, and then restore it so it can eventually reopen as a community cultural center.

The community corporation obtained the keys to La Casa on Jan. 1st, according to the ELACC’s Isela Gracian.

ELACC is working on having the building assessed for restoration, but first it has to pay off the half-million dollar debt left by the former mangers. EGP archive photo from 2012 by Gloria Angelina Castillo

ELACC was selected by the State Attorney General’s office to preserve and operate the building, the Mexican American Opportunity Fund (MAOF) had also previously been considered.

The transfer is the result of a lawsuit filed late last spring by the state attorney general’s office against husband and wife Martha and Ruben Soriano, and Martha Velasquez, which claimed they were running the non-profit cultural institute for their own person benefit, going so far as to illegally transfer La Casa del Mexicano’s deed from the non-profit Comité de Beneficencia Mexicana de Los Angeles, Inc. to Mexican Benefit Corp. (MB Corp.), essentially running it as their private entity.

Lea esta nota en ESPAÑOL: Juez Disuelve Organización, Ordena de la Transferencia ‘La Casa del Mexicano’

As previously reported by EGP, at about the same time those actions were taking place, a number of community activists were growing concerned that the center had moved away from its non-profit charter and mission to serve as center for Mexican cultural and civic activities. Javier Rodriguez, director of the March 25th Coalition and the Committee to Rescue la Casa del Mexicano, told EGP the Sorianos were using the non-profit for personal financial gain. Rather than putting on legitimate cultural and civic events, LA Casa had become a rundown venue where Lucha Libre matches and swap meets were held, with proceeds going to the Sorianos, he alleged.

In 2006, the Sorianos took out a $175,000 loan against the property, which community activists also claimed was illegal since it was done without the approval of the nonprofit’s board of directors, as required by law. After failing to make payments, the property fell into foreclosure.

In hopes of stopping a planned auctioning off the landmark, community activists brought La Casa’s precarious financial and management situation to the attention of elected officials demanding an investigation. With backing from several local elected officials—including Los Angeles Councilmember José Huizar and State Senator Kevin De León—an investigation was opened by California Attorney General Kamala D. Harris’ office, which brought the civil lawsuit against the Sorianos.

On Dec. 19, 2012, Los Angeles County Superior Court Judge Michael Johnson ordered the property to be transferred to ELACC and found the defendants liable for monetary damages, civil penalties and the state’s legal fees.

In addition to declaring the Soriano’s deed transfer “null and void,” and the “title to La Casa is quieted to Comite,” the judge also ordered that Comite and MB Corp be dissolved.

The Mexican Consul General of Los Angeles established Comité de Beneficencia Mexicana and registered the property under the non-profit in 1931.

The judgment also ordered Martha and Ruben Soriano—the former directors of MB Corp.—to pay ELACC over $177,000 as MB Corp.’s final distributee. This quantity is for “unexplained and unsupported expenses” incurred by the Sorianos on behalf of MB Corp, according to the Attorney General’s press office.

“The Sorianos, as fiduciaries of MB Corp have the burden of accounting for the expenses of the charitable organization. We gave them an opportunity to do so and they did not,” the attorney general’s press office told EGP via email.

The Sorianos and Martha Velasquez, also a former MB Corp. officer, must also pay another $27,534 to ELACC, for other “unexplained and unsupported expenses” incurred by the Sorianos and Velasquez.

“We did not have any evidence that Velasquez was an officer or director when disbursements were made from one of MB Corp’s bank accounts that we reviewed, so she is liable for less damages than the Sorianos,” the email explains.

In addition, the Sorianos and Velasquez were also ordered to pay over $217,000 in attorney fees and civil penalties.

The Sorianos had previously filed for bankruptcy, not once but twice, which resulted in La Casa’s auction being postponed. Both bankruptcy cases were dismissed, according to the Attorney General’s press office. The judgment, however, does not discharge any liability by Comite, MB Corp, the Sorianos or Velasquez to creditors.

Community activists said they are elated by the judge’s ruling.

“This is wonderful news, we are vindicated,” Rodriguez of the Committee to Save La Casa told EGP upon hearing about the judgment.

He said his group’s next step would be to make sure that criminal charges are brought against the trio, adding they will hold a press conference sometime in the next few days.

In the meantime, ELACC is putting together plans for operating the facility located at 2900 Pedro Infante St., — which is actually comprised of two lots at 529 Euclid Ave. and 2901 East 6th St. LA 90063, with Pedro Infante Street being a private driveway. First, however, the nonprofit must come up with a plan for paying off the nearly $500,000 lien on the building held by Brownstone Mortgage Fund I Limited Partnership, which resulted after MB Corp. defaulted on a $175,000 loan, Gracian said.

“There are many challenges ahead, including decades of deferred maintenance and a nearly half-million dollar debt incurred by the previous non-profit owner,” said ELACC President Maria Cabildo in a written statement. “For now, ELACC will be focused on securing funding to pay off the existing debt and assessing the viability of the building’s systems. We are excited to get started and have this cultural treasure operational in the neighborhood of Boyle Heights.”

The former mosque is composed of a basement on the first floor, a performance space (theatre) and offices on the second floor/main level, and more offices on the third floor with a mezzanine. The building has two restrooms, and a kitchen in the basement. The property also has a parking lot.

According to Gracian, ELACC needs to pay off the building and is looking for private and public entities that would be interested in funding the renovations of the nearly 90-year-old building, which has not received proper maintenance over the years.

ELACC will also seek partnering organizations to carry out La Casa’s original mission to stimulate civic and social engagement in the Mexican immigrant community. This process will include community engagement, in order to bring the building back to its original “splendor” and have it serve as a cultural resource once more, said Gracian.

Several attempt were made to contact Velasquez and the Sorianos. At first, Velasquez declined to comment but on Tuesday evening she called EGP and speaking in Spanish said, “I always spoke the truth and I really have nothing to say, it was the Sorianos who managed all this.”

EGP reached Martha Soriano by phone last week, but said she had a bad connection and would call back. Neither she nor her husband have returned EGP’s request for comment.

Last summer, Ruben Soriano told EGP he felt he and his wife were victims of defamation. He underscored that they are hardworking people and accused Rodriguez of spreading lies and questioning his mental health.

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