NEW AUDIT RIPS NEWMANPR & TDC; STATE ATTORNEY STILL INVESTIGATING

Key West's Southernmost Point is one of the most-visited spots for tourists on the island. CONTRIBUTED

In 2023, Monroe County’s public relations agency of record, NewmanPR, collected more than $1.9 million from Monroe County. That total comes from an annual fee of $733,688, plus more than $1.1 million in expenses.

But a review of Newman PR invoices and its billing practices revealed questionable costs, documentation and reimbursement requests, noncompliance with county policies, invoicing before work was completed and a lack of a procurement process that amounts to “fiscal arrogance” according to an audit released Feb. 8 by the Monroe County Clerk of Court Kevin Madok’s office.

And the TDC’s problems don’t stop with NewmanPR, the audit says.

The clerk’s auditors said these issues with NewmanPR stem from the TDC marketing director, Stacey Mitchell, who is not named in the audit, “not effectively managing the TDC’s public relations agency of record,” auditors said.

Mitchell was suspended with pay in November 2023, and the county directed staff to hire a North Carolina-based accounting firm to review the TDC’s operations.

On top of a lack of oversight by the TDC is “NewmanPR’s apparent willingness to take advantage of the lack of management oversight,” auditors said.

In response to the audit, the TDC board scheduled a special meeting for 10 a.m. Feb. 20 in Marathon at the Faro Blanco Resort and Yacht Club. 

State Attorney’s Office is investigating the TDC

Discussions by county commissioners last November to hire an outside accounting firm to investigate the Florida’ Keys tourism marketing agency and partner agencies, like NewmanPR, led Monroe County State Attorney Dennis Ward to begin an investigation of his own.

Ward said he decided following the meeting that he needed a forensic audit and hired the Miami-based Berkowitz Pollack Brant Advisors (BPB). 

BPB’s interdisciplinary practice includes certified public accountants, fraud examiners, financial forensic specialists and computer forensic professionals. The team’s range of services include business valuations and accounting investigations for expert testimony in commercial disputes and corporate and fraud investigations. 

A forensic audit by BPB and Richard Fechter, associate director of forensic and advisory services, will take three to four months. Fechter has led many financial fraud investigations, including a $1.3 billion Ponzi scheme. 

While Ward couldn’t say exactly which kind of charges could come as a result of the forensic audit, he told Keys Weekly that he believes there “will be things to bring forward.”

“I’m not sure if it’s strictly criminal or civil or a combination of the two,” Ward said. “I won’t know until we get it (the audit) back.”

Andy Newman, president of NewmanPR, speaks at the Nov. 16 Tourist Development Council board meeting. MANDY MILES/Keys Weekly

Newman calls report ‘biased’

Andy Newman, president of NewmanPR, told Keys Weekly the clerk’s audit seems biased.

“My team and I were stunned and saddened by the improper attacks on our company and the Monroe County Tourist Development Council,” Newman said. “They seemingly reflect a hostile bias which is evident in many of the clerk’s office recommendations.”

Newman hired lawyers after the October 2023 audit of the TDC, the first clerk’s office report on the tourism agency in at least 20 years. 

In a 14-page response to the NewmanPR audit, his attorney says the clerk’s audit is a collection of opinions about the contract and rejects an earlier finding by the county attorney.

“The clerk’s opinion is a manifesto revealing the clerk’s disdain for the contract with NewmanPR and the overall operation of the Monroe County Tourist Development Council/Visit Florida Keys,” wrote attorney Russell A. Yagel. 

For starters, Yagel said the county’s contract with NewmanPR doesn’t require Newman to follow Monroe County purchasing policies for hiring subcontractors. As for double-billing accusations, Yagel said the county’s top lawyer has already settled that question. 

At the Nov. 8 meeting of the Monroe County Board of County Commissioners, County Attorney Bob Shillinger said he found no evidence of double-billing by NewmanPR. 

Newman’s photography services, which are the crux of the clerk’s double billing argument, aren’t included within the scope of the monthly fee Newman gets, Shillinger said. 

“The clerk is free to have a different view,” Shillinger told the commissioners.

The clerk’s audit’s double-billing argument cites Newman’s reimbursement for a hotel room in Key West to cover Fantasy Fest. Newman put the room down as public relations work, and then put in for the photography work he did during the event separately. 

That’s how the contract works, Yagel said, adding it would have cost the county more had Newman hired a photographer to cover the event.

A screenshot from the Monroe County Clerk’s audit of NewmanPR lists the annual agency fee and the amounts reimbursed to NewmanPR for the last five fiscal years.

A 43-year relationship

Originally started by Stuart Newman, NewmanPR has been the Tourist Development Council’s top marketing firm for 43 years and known in legal papers as the TDC’s public relations agency of record. 

The first contract between Monroe County’s TDC and NewmanPR in the early 1980s called for a total of $500,000 in compensation for advertising promotion, public relations and marketing services. Of the half-million paid, $44,000 was allotted for PR.

By 1986, services provided by NewmanPR no longer included advertising but rather focused exclusively on public relations, publicity, and press relations with compensation of $100,000, plus reimbursable expenses. Today, NewmanPR is defined in its contract as a “full-service public relations agency for the Monroe County TDC and county,” Madok’s auditors said.

Andy Newman took over his father’s business and has always worked in the trenches much like a journalist. But his job is being a public relations giant, not a newsman. His work promotes the Florida Keys as a tourist destination, keeping the islands in the mainstream news cycles with a constant stream of high-end photos and videos.

A four-decade tenure with a contractor like NewmanPR has benefits, the auditors said, but that length of a business relationship “also runs the risk of creating a sense of complacency between those executing oversight over a contractor and the contractor themselves.”

Newman, a professional photographer, is known for delivering aerial shots of the island chain and write-ups of Keys events, bolstered by a team of professionals, to news outlets across the world.

Madok’s auditors concluded Newman is experienced and has knowledge about the Keys, but his billing practices don’t follow county policy and procedure designed to protect public funds.

“We recommend that the BOCC work with the TDC to consider all available options on how to best to proceed to fully restore the public’s trust and confidence in the TDC’s business operations,” the audit states.

One solution, the auditors said, is for the BOCC to consider ending the county’s current TDC administrative contract with the non-profit Visit Florida Keys and set up the TDC’s structure as a county department overseen by the county administrator.

Requesting payments from a company that doesn’t exist

Newman’s firm has made requests to be paid for work done by a company he calls Graphics 71.

But the firm doesn’t legally exist, which Newman’s firm admitted to the clerk’s office. Newman has said the work would have been subcontracted out anyway.

“NewmanPR admitted that any checks that NewmanPR made payable to Graphics 71 were ultimately destroyed because no bank would cash the checks made out to a nonexistent company,” auditors reported. “In other words, NewmanPR used a nonexistent company as a conduit to claim they made payments eligible for reimbursement when, in fact, no payments were made for there to be valid reimbursable expenses.”

This is a “minor, frequent oversight by small businesses and easily rectifiable,” Newman’s attorney Russell A. Yagel said. 

Auditors, however, said the fictional company set-up “suggests NewmanPR “regularly demonstrated a general disregard for the expenditure of public monies. NewmanPR requested, received, and retained funds for a nonexistent expense.”

Madok told Keys Weekly his office spent hundreds of hours on the audit document. They finished a month ago and were editing and running it past lawyers before releasing it on Feb. 8.

Two additional, separate audits are coming, Madok said. One will audit Two Oceans Digital, which handles website and digital marketing, and the other on Tinsley Advertising & Marketing, which handles advertising for the TDC.

Upper Keys Editor Jim McCarthy contributed reporting for this story.

Gwen Filosa is The Keys Weekly’s Digital Editor, and has covered Key West news, culture and assorted oddities since she moved to the island in 2011. She was previously a reporter for the Miami Herald and WLRN public radio. Before moving to the Keys, Gwen was in New Orleans for a decade, covering criminal courts for The Times-Picayune. In 2006, the paper’s staff won the Pulitzer Prizes for breaking news and the Public Service Medal for their coverage of the Hurricane Katrina disaster. She remains a devout Saints fan. She has a side hustle as a standup comedian, and has been a regular at Comedy Key West since 2017. She is also an acclaimed dogsitter, professional Bingo caller and a dedicated Wilco fan.