By Christopher Hagedorn
Rep. Eliot Engel told the Daily News earlier this week that he was having drinks with one of his political benefactors, Harry Bajraktari, a prominent leader in the Albanian community whose partners and family have contributed $72,200 to his campaigns over the last three elections, when he suggested that Engel could become a 24% partner in a building he was buying.
“We were discussing one day, you know, I'm buying this little property,” Engel told the News, “would you want to take a piece of it.”
The conversation in 2008 led Engel to invest $30,000 to buy 1142 Metcalf Ave., a three-story building with six apartments.
Engel failed to report the investment in his financial disclose statements filed with the federal government in 2008 and 2009, and belatedly reported it in 2010.
Engel's excuse: He didn't make any money from his investment.
Most curious is how Engel reported the investment, wrongly identifying E & J Realty Group. His disclosure form lists ENJ Realty, LLC.
If one were to say, “E & J,” it can sound like ENJ. It remains unknown whether Engel was ignorant of the name of the company in which he had invested, or purposely misstated it deflect an investigation.
Understanding an ampersand - an and sign - is not the letter N is just one of the problems with the filing. Another is Engel's obviously ignorance of the meaning of asset value.
Engel reported his “Year-end Value of Asset” was ranging from $250,000 to $500,000, though the cost of the building was $430,000 and Engel invested $30,000 worth 24% of the entire business.
The Bronx News invited an accountant to explain how assets are valued.
“In this case, Engel probably paid $30,000 for 24% of the building, with E & J Realty paying $120,000 in case and obtaining a mortgage of $310,000, equally the sale price. When calculating an asset, the value is based on the cash paid, not the mortgage. If the building were sold tomorrow, Engel would be the partnership with $30,000.”
The accountant who asked not to be identified said simply, “I'm not political, but this member of Congress is obviously unsophisticated in elementary economics.”
