WASHINGTON - The Village Center Community Development District's issuance of $64.3 million of recreational revenue bonds "effectively perverts" Florida law by allowing the private developer of the Villages retirement community to "engage unchecked in self-dealing," an Internal Revenue Service agent warned in three notices he sent the district last month.

In the notices, IRS agent Dominick Servadio Jr. said that the board of supervisors for the CDD - which issued the bonds to finance the purchase of two golf courses, several parks, and other facilities from the developer, the Villages of Lake Sumter Inc. - is made up entirely of high-ranking employees or people affiliated with the developer. As a result, the agent said, the board could not have exercised independent oversight of the bond transaction.

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