MIAMI (CBSMiami) -- Katherine Fernandez Rundle, the top law enforcement official in Miami-Dade County, is scheduled to attend a fundraiser Wednesday evening for her re-election campaign that will be co-hosted by a man who admitted in federal court to loaning money at a 36 percent interest rate, which would be considered a violation of Florida's laws against loansharking.
Hialeah Mayor Carlos Hernandez is one of four individuals listed on a flyer obtained by CBS4 News soliciting $1,000 contributions on behalf of Rundle, who has served as State Attorney since 1993.
As part of her campaign, Rundle recently sent an email to supporters lauding her own accomplishments.
"You deserve a criminal justice system led by people that you can depend on to do what is right consistently, independently and with integrity," Rundle wrote. "With your support, I have worked diligently to fulfill those ideals and goals."
Asked Wednesday afternoon by CBS4's Jim DeFede why she would allow Hernandez to host her fundraiser, Rundle replied: "You know, I don't know why I wouldn't."
Hernandez's role in Hialeah's "shadow banking" world was exposed during the 2014 federal trial of another former Hialeah mayor, Julio Robaina, who was accused of tax evasion for allegedly failing to report the money he received from high-interest loans he made to convicted Ponzi schemer Luis Felipe Perez.
Robaina and his wife were ultimately acquitted of the tax charges.
During the trial, however, Hernandez appeared as a prosecution witness to describe his own role as a private money lender. Under oath, Hernandez admitted that in 2007 he also loaned Perez, known as Felipito, $180,000 at an annual interest rate of 36 percent. In the state of Florida, unless specifically permitted by law, lending money at interest rates between 25 and 45 percent is considered a second-degree misdemeanor.
"I know the incident you're talking about nine years ago in 2007," Rundle said, "but you know he still represents the second largest city in my community. Many of my constituents live and work in Hialeah. There is no criminal case against him or has been. So I feel comfortable with him representing his city in support of my candidacy."
No criminal charges could be brought against Hernandez from his federal court testimony because the statute of limitations on the state loansharking statutes had already expired.
Hernandez's admission in court came in stark contrast to his repeated denials three years earlier, in 2011, when he first ran for mayor. During that campaign, the Miami Herald revealed Hernandez's high-interest loans to Perez, prompting Hernandez to call a press conference and indignantly deny the allegations.
Following his 2014 testimony in federal court, the Miami-Dade Commission on Ethics and Public Trust launched its own investigation, accusing Hernandez of lying to the public -- a violation of the Citizens' Bill of Rights which allows elected officials to be fined for knowingly lying to the public.
The Ethics Commission focused on the 2011 press conference Hernandez held during his campaign to deny the Miami Herald story about his loans to Perez.
When he was placed under oath and questioned by the attorney for the Ethics Commission, Hernandez invoked his Fifth Amendment right against self-incrimination 30 times, refusing to answer questions about his activities. He called the Ethics Commission a "circus."
The investigator for the Ethics Commission noted it was clear Hernandez had lied to the public based on his testimony in federal court.
"Responding to questions from veteran federal prosecutor Richard Gregorie, Hernandez admitted loaning Perez $180,000 with the expectation of 3-percent monthly interest payments, or 36-percent annual returns, which would violate state loansharking statutes," the Ethics Commission report investigative report states.
The Ethics Commission ultimately found him to be in violation of the Citizens Bill of Rights for lying – once in Spanish and once in English – and fined him a total of $4,000.
Rundle said she wasn't concerned by the Ethics Commission findings.
Last year Hernandez attempted to pay the fine in pennies, but the Commission refused. The Ethics Commission is now suing Hernandez for a more appropriate form of payment. They recently reached a settlement where the Ethics Commission will receive a check for the fine.
"I am familiar with the ethics findings," she said. "They were civil in nature."
Rundle seemed confused by the questions surrounding Hernandez.
DeFede asked her if she was at all concerned about associating herself and her office with someone who shows contempt for the ethics commission, whose testimony in federal court reveals he may have violated Florida laws relating to loansharking.
"Is this how you operate an integrity driven campaign?" DeFede asked.
"Well, I disagree with your characterization on the loan sharking, if you look at the state statute I don't believe it qualifies under that," she said. "I'm sorry that the ethics commission and he are at odds."
When DeFede asked Rundle what she would call a person who charges an interest rate of 36 percent, she smiled and said, "It's not what I say, it's what the law says."
Florida Statutes Chapter 687 defines loansharking as "the act of any person as defined herein lending money unlawfully" and states that charging interest rates between 25 and 45 percent is guilty of a second degree misdemeanor.
Told that state statutes maintains that charging a 36 percent interest rate would be a second degree misdemeanor, Rundle smiled and walked away.
Hernandez did not respond to a request for comment.
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