Former University at San Antonio Projects Manager Indicted by Federal Grand Jury in Connection with an Alleged Bribery Scheme

August 26, 2013

The Federal Bureau of Investigation (FBI) on August 23, 2013 released the following:

“A federal grand jury in San Antonio this week returned a bribery indictment against 41–year-old James Paul Council, a former project manager in the Facilities Department at the University of Texas at San Antonio, and three other San Antonio area residents in connection with a bribery scheme announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez. As of today, all four defendants have surrendered to federal authorities.

The 17-count indictment charges Council; 47-year-old Alfredo Romero Gonzalez, owner of Power Source Electric, an electrical construction and repair business in San Antonio; 60-year-old Power Source Electric chief estimator and project manager Magin Villalon (a.k.a. “Buddy”); and Villalon’s wife, 56-year-old Sarah Anne Luna, with one count of conspiracy to commit bribery concerning programs receiving federal funds and four counts of mail fraud. Council is also charged with six counts of receiving a bribe; the other defendants, six counts of paying a bribe.

According to the indictment, from approximately August 2011 through September 2012, the defendants allegedly conducted a scheme to bribe a purchasing officer in order to secure UTSA construction contracts. The indictment further alleges that the defendants colluded in the submission of fraudulent, inflated bids to UTSA under the names of sham companies, GNZ Enterprise LLC and Vista Contracting, and fixed at least 40 UTSA contracts. Authorities estimate the submitted bids totaled more than $200,000. Furthermore, the indictment alleges that Council received cash, as well as improvements to his residence for his role in the scheme.

Upon conviction, the defendants face up to five years’ imprisonment on the conspiracy count, up to 10 years’ imprisonment for each bribery related count, and up to 20 years in federal prison for each mail fraud count. All four defendants are on bond pending further court proceedings.

This indictment resulted from an investigation conducted by the agents with the Federal Bureau of Investigation, together with the San Antonio Police Department and the University of Texas at San Antonio Police Department. Assistant United States Attorney James Blankinship is prosecuting this case on behalf of the government.

An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Virginia Businessman Pleads Guilty to Federal Money Laundering Charge in Investigation of Federal Government Contracts

April 19, 2012

7thspace.com on April 18, 2012 released the following:

“WASHINGTON— James Edward Miller, 64, the owner of a Virginia-based construction management company, pleaded guilty today to a federal charge of conspiracy to commit money laundering in connection with an ongoing investigation into the awarding of millions of dollars of contracts by the United States Army Corps of Engineers.

The plea was announced by United States Attorney for the District of Columbia Ronald C Machen, Jr; James W McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office; Eric Hylton, Acting Special Agent in Charge of the Washington Field Office of the Internal Revenue Service-Criminal Investigation (IRS-CI); Peggy E Gustafson, Inspector General for the Small Business Administration (SBA); Robert E Craig, Special Agent in Charge of the Mid-Atlantic Field Office of the Defense Criminal Investigative Service (DCIS); and Major General David E Quantock, the Commanding General of the United States Army Criminal Investigation Command (CID).

Miller, formerly of Virginia Beach, Virginia, pleaded guilty in the United States District Court for the District of Columbia. A sentencing date has not been set. The charge carries up to 20 years in prison as well as potential fines and an order of restitution. As part of the plea agreement, Miller must forfeit a money judgment of $4,055,063 and forfeit specific property, including bank account funds, a property in Virginia Beach, three vehicles, diamond rings, and other jewelry.

Miller is the sixth person to plead guilty to charges stemming from an investigation into a scheme that unfolded from 2007 to 2011.

The scheme allegedly involved two former managers for the United States Army Corps of Engineers, various businesses and executives, more than $20 million in bribes and kickback payments, and the planned steering of a government contract that potentially was worth about $1 billion.

Miller’s role in the crimes is described in a statement of offense that he signed as part of his plea agreement. Miller was the owner of Big Surf Construction Management LLC, a company based in Virginia Beach that was involved in residential and commercial construction projects. He was a close friend of another businessman, Harold Babb, the director of contracts at Eyak Technology (EyakTek), a business with an office in Dulles, Virginia.

In 2008, Babb proposed that Miller use Big Surf to obtain government contracts awarded by the United States Army Corps of Engineers. Under the plan, Big Surf would be hired by EyakTek as a subcontractor.

Initially unbeknownst to Miller, Babb was already involved in a conspiracy with, among others, Kerry F Khan, then a program manager for the United States Army Corps of Engineers, and Ananke LLC, a company that was controlled by Khan.

The statement of offense identifies three subcontracts awarded and paid by EyakTek to Big Surf in 2008 and 2009, totaling more than $8 million. Of this money, Big Surf channeled more than $3.6 million from the first two subcontracts to Ananke. According to the statement of offense, Babb directed Miller to pay another $2.9 million, from the third subcontract, to Ananke. However, Miller allegedly reneged on the plan and Big Surf kept the money.

As a result, a fourth intended subcontract, worth about $1.9 million, was canceled.

In the early stages, according to the statement of offense, Miller believed that Ananke was actually providing services for the money. However, by the time of the second contract, he knew that Ananke was not providing services to EyakTek or the Army Corps of Engineers. He also understood that Babb was using his position at EyakTek to facilitate the award of orders to Big Surf in exchange for payments from Big Surf directly and indirectly to Babb.

Indeed, during the scheme, Miller and Big Surf provided a number of benefits to Babb, including cash payments, an investment in real estate, and money for a Porsche.

Babb, 60, pleaded guilty in March 2012 to federal charges of bribery and unlawful kickbacks. He is awaiting sentencing.

Khan, 54, was indicted in September 2011 on one count of conspiracy to commit bribery and wire fraud and aiding and abetting and causing an illegal act to be done, as well as one count of bribery and one count of conspiracy to commit money laundering. He pleaded not guilty.

In the overall investigation, to date, the United States has seized for forfeiture or recovered approximately $7.2 million in bank account funds, cash and repayments, 19 real properties, six luxury cars, and multiple pieces of fine jewelry.

In announcing the plea, United States Attorney Machen, Assistant Director McJunkin, Acting Special Agent in Charge Hylton, Inspector General Gustafson, Special Agent in Charge Craig, and Major General Quantock thanked those who investigated the case from the FBI’s Washington Field Office; the Washington Field Office of IRS-CI; the Office of the Inspector General for the SBA; DCIS; the Defense Contract Audit Agency; and the United States Army CID. They also expressed thanks to the United States Marshals Service for its assistance on the forfeiture matter.

They also praised the efforts of those who worked on the case from the United States Attorney’s Office for the District of Columbia, including Assistant United States Attorneys Michael K Atkinson and Bryan Seeley of the Fraud and Public Corruption Section and Assistant United States Attorney Anthony Saler of the Asset Forfeiture and Money Laundering Section. Finally, they expressed thanks for assistance provided by former Special Assistant United States Attorney Christopher Dana; Forensic Accountant Maria Boodoo; Paralegal Specialists Tasha Harris, Shanna Hays, Taryn McLaughlin, Sarah Reis, Christopher Samson, and Nicole Wattelet and Legal Assistant Krishawn Graham.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


‘Botched’ Federal Criminal Indictment Ends in Acquittal

March 21, 2012

The Gainesville Sun March 20, 2012 released the following:

“‘Botched’ indictment ends in local firm’s acquittal

By Jason Geary and Anthony Clark
The Gainesville Sun

A Gainesville-based construction company and its vice president were acquitted on federal charges of bribing a Polk County school official in Tampa on Monday because the grand jury indictment mistakenly referred to the Polk County government and not the Polk County School District.

M.M. Parrish Construction Co. and its vice president, Lloyd Whann, were on trial in Tampa’s federal courthouse for two weeks on charges of bribing Bob Williams, former assistant superintendent of facilities for the Polk County School Board.

Prosecutors accused the company of gaining a competitive edge by bribing Williams with posh hunting and fishing trips, expensive bathroom renovations on Williams’ home and a $2,000 shotgun.

The Gainesville-based company has received more than $100 million worth of work from the Polk County School Board, nearly four times as much work as its nearest competitor.

The defense argued the company got work based on its reputation for high-quality work and had no intent to influence Williams with gifts.

“Witnesses testified one after the other that there was not a better construction company in the state to show they got the work they got because they are the best. That’s the only reason they got it,” said Henry M. Coxe III, the company’s attorney.

Williams still faces punishment because he accepted a plea deal last year. He pleaded guilty to one count of conspiracy to commit bribery, which carries a maximum penalty of five years in prison.

Whann’s attorney, Larry Turner of Gainesville, said the acquittal was about more than poor verbiage in the indictment. The case was in federal court because the indictment said Polk County received federal funding, but Williams worked for the Polk County School District, a separate government agency. That meant the evidence presented was insufficient, he said.

Turner said there were other problems with the way the indictment was drafted.

U.S. District Judge Richard A. Lazzara said he has never seen a “botched situation” like this in his 14 years on the federal bench.

Lazzara told Michael Walsh, the company’s president, and Whann that they were not guilty of the charges and were free to leave.

The sudden ending brought both men to tears, and they embraced their lawyers, family and friends.

“I just had to thank God, that’s all I could think was thank you God for bringing us through this,” Walsh told The Sun on Tuesday. “We just appreciate all the love and support that we received from friends and customers and people from all over throughout the whole process.”

While M.M. Parrish Construction and the local real estate firm Coldwell Banker M.M. Parrish Realtors were founded locally by the Parrish family, the construction company was sold in the early 1980s.”

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To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


FBI probes alleged gambling houses in Jefferson County

March 20, 2012

ENewsCourier.com on March 19, 2012 released the following:

“Associated Press

MONTGOMERY, Ala. (AP) — The FBI’s gambling corruption investigation in Montgomery wasn’t the only one going on at the same time in Alabama.

The FBI was recording phone calls and meetings in Jefferson County a few months after it did the same thing in Montgomery. Court records show one Jefferson County businessman has agreed to plead guilty and several other people are under investigation over electronic bingo machines installed in the small town of Kimberly, 20 miles north of Birmingham.

Kimberly Mayor Craig Harris said Monday he initiated the investigation and is glad he can finally talk about his role. He worked as an informant who let the FBI record his phone calls and meetings, including ones where he received cash payoffs from gambling operators in return for police protection.

“There wasn’t any fear behind it because I was doing the right thing from the start,” the 38-year-old mayor said.

But he said he regretted he couldn’t be straightforward with constituents in the town of 1,800 when they called to complain about him doing nothing about the illegal operations.

“There were several calls about, ‘Why aren’t you doing anything?'” he said.

The Kimberly investigation and the Montgomery investigation were both run out of Washington by the Justice Department’s Public Integrity Section. But they differed dramatically in size. One involved thousands of machines and millions in offers. The other involved dozens of machines and thousands in payoffs.

Justice Department spokesman Laura Sweeney said Monday she could not comment about the ongoing investigation in Jefferson County.

The Montgomery case involved two huge electronic bingo casinos in Dothan and Shorter. The Dothan operator, his two lobbyists and a former legislator pleaded guilty and will be sentenced in July and August. The operator, Ronnie Gilley, admitted offering millions in bribes to get votes for pro-gambling legislation in 2010.

The operation in Jefferson County involved at least four houses in and around Kimberly that had eight to 10 electronic bingo machines each and operated 24 hours a day as makeshift gambling halls, the mayor said.

He said one of the operators approached him on a Saturday in 2010 with an offer of about $150 a week to keep the Kimberly police away and provide notice if there was going to be a crackdown. He contacted the state attorney general’s office on Monday morning to report the offer and was meeting the next day with representatives of the attorney general and FBI to set up the undercover operation.

He said he started collecting $150 weekly payments for one gambling business and then added others, eventually collecting several thousand dollars while the FBI recorded the payoffs in late 2010 and early 2011. The mayor said he handed over all the money to the FBI each week.

Federal court records filed late last week show that Daniel “Boone” Stone of Morris has agreed to plead guilty Thursday to one count of conspiracy to commit bribery and operating an illegal gambling business. In return for his cooperation, federal prosecutors agreed to recommend a prison sentence of six to 12 months and a fine of $2,000 to $20,000.

Stone’s attorney, Scott Morro, said his client played a minor role in the case and wanted to put it behind him by reaching a plea deal.

“I guess my guy is a Gilley,” he said, referring to the casino developer who pleaded guilty in Montgomery and helped prosecutors.

Morro said federal prosecutors told him they had built a case on taped recordings, but he had not heard them.

Court documents filed in his case describe at least five others involved in the gambling businesses, and one of the houses they used was owned by Stone’s father. The father was not named, and Morro said he hopes the father will remain out of the case.

The court papers say the machines came from a convenience store owner in Gardendale and a club owner from Warrior, but they are not identified by name.

The mayor said sheriff’s deputies raided the gambling hall that was in the Stone home in 2011, and the others closed voluntarily. He said he knew Daniel Stone because he was part-owner of an IGA grocery store in Kimberly that has since closed, and the other alleged co-conspirators were friends or acquaintances who lived in the area. He said he can’t identify them because the investigation is ongoing.

This is not the first time Kimberly has had a gambling issue. In May 2008, police seized 189 gambling machines, valued at more than $1 million, from a warehouse. They destroyed them in 2011 after winning a three-year legal battle with the owner.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

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To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Former Employee and Contractors of Florida Property Management Company Indicted in Illinois for Alleged Conspiracy to Commit Bribery and Wire Fraud

January 17, 2012

The U.S. Department of Justice (DOJ) on January 17, 2012 released the following:

“WASHINGTON – A Rockford, Ill., grand jury today indicted a former residential sales manager and two former contractors of a Florida property management company in connection with housing repair contracts for the U.S. Department of Veterans Affairs (VA), the Department of Justice announced.

The 10-count indictment filed today in U.S. District Court in Rockford charged Ryan J. Piana, Ronald B. Hurst and Bryant A. Carbonell with conspiring to commit bribery and wire fraud from beginning at least as early as January 2006 continuing until as late as September 2007. Piana, Hurst and Carbonell are also charged with bribery and wire fraud.

Piana is a former residential sales manager at West Palm Beach, Fla.-based Ocwen Loan Servicing LLC, and Hurst and Carbonell are former contractors for Ocwen. According to court documents, Ocwen managed foreclosed properties under contract with the VA, which guaranteed qualifying residential mortgages for veterans. Under the contract between the VA and Ocwen, if a veteran defaulted, Ocwen completed necessary repairs and re-sold the property.

Proceeds from the re-sale of VA-acquired properties directly benefit the VA by reducing the cost of guaranteeing residential mortgages to veterans.

According to the charges, Hurst and Carbonell paid Piana to steer housing repair work to companies affiliated with Hurst and Carbonell. Piana recruited other Ocwen employees into the scheme and paid them on behalf of himself and the other conspirators. The department said in order to execute the scheme, the conspirators sent, or caused to be sent, various transmissions via wire communication.

This is the second case involving properties managed by Ocwen under contract with the VA. On Dec. 3, 2010, Benjamin K. Graves, also a former Ocwen employee, pleaded guilty in U.S. District Court in Orlando, Fla., to wire fraud in connection with the VA contract.

The wire fraud charges carry a maximum penalty of 20 years in prison; the bribery charges carry a maximum penalty of 15 years in prison; and the conspiracy charge carries a maximum penalty of five years in prison. The maximum fine for each charge is $250,000. For wire fraud and conspiracy, the maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine. For bribery, the maximum fine may be increased to three times the value of the bribes, if that amount is greater than the statutory maximum fine.

The charges announced today resulted from an ongoing federal investigation of housing repair contracts performed under contract with the VA. The investigation is being conducted by the Antitrust Division’ s Chicago Field Office and the Central Field Office of the U.S. Department of Veterans Affairs, Office of Inspector General, Criminal Investigations Division, located in Hines, Ill. ”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Florida Couple and Utah Man Indicted for Alleged Roles in Procurement Fraud Scheme Involving Foreign Military Materials

October 13, 2011

The Department of Justice (DOJ) on October 12, 2011 released the following:

“WASHINGTON — Three individuals were charged in an indictment returned today by a federal grand jury in Utah for their alleged roles in a bribery and fraud scheme involving federal procurement contracts, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney David B. Barlow for the District of Utah.

The four-count indictment returned today in U.S. District Court in Salt Lake City charges Sylvester Zugrav, 68, and Maria Zugrav, 66, both of Sarasota, Fla., and Jose Mendez, 49, of Farr West, Utah, with conspiracy to commit bribery and procurement fraud. The Zugravs and Mendez also are each charged with bribery. In addition, Mendez is charged with procurement fraud.

According to the indictment, Mendez worked as a program manager for the U.S. Air Force Foreign Materials Acquisition Support Office (FMASO). The mission of FMASO is to purchase foreign military materials on behalf of their customers, which are various U.S. military divisions. The materials are acquired outside of the United States by third party companies, or vendors, and then purchased by FMASO on behalf of its customers. There are a limited number of vendors permitted to contract for the sale of foreign materials to FMASO, one of which is Atlas International Trading Corporation (Atlas). According to the indictment, Sylvester and Maria Zugrav were the principals of Atlas.

According to the indictment, the Zugravs and Mendez conspired to enrich one another by exchanging money and other things of value for non-public information and favorable treatment in the procurement process. The Zugravs allegedly offered Mendez approximately $1,240,500 in payments and other things of value throughout the course of the conspiracy. The Zugravs allegedly made bribe payments to Mendez in three different ways: cash payments via FedEx to Mendez’s home address; in-person payments of cash and other things of value; and electronic wire transfers to a bank account in Mexico opened by and in the name of Mendez’s cousin. According to the indictment, from approximately 2008 to August 2011, the Zugravs gave Mendez and a person close to him more than $185,000 in payments and other things of value, with promises of additional bribe payments if Atlas were to receive future contracts for the sale of foreign materials to FMASO customers.

In return for the bribes offered and paid, Mendez allegedly gave Atlas and the Zugravs favorable treatment during the FMASO procurement process, including disclosing government budget and competitor bid information, which helped Atlas and the Zugravs in winning FMASO contracts.

According to the indictment, Mendez and Sylvester Zugrav allegedly communicated offers and requests for bribes in person and through email, and took steps to conceal their activity, using covert email addresses, password-protected computer documents, code words and false names. Within the encrypted documents, Mendez adopted the name “Chuco” and Sylvester Zugrav used the name “Jugo,” and they referred to cash as “literature.”

The Zugravs and Mendez each are charged with one count of conspiracy to commit bribery and procurement fraud, and one count of bribery. Mendez is also charged with one count of procurement fraud for disclosing non-public information to a separate FMASO vendor other than Atlas.

The maximum penalty for conspiracy is five years in prison and a $250,000 fine. The maximum penalty for procurement fraud is five years in prison and a $250,000 fine, while the maximum penalty for bribery is 15 years in prison and a $250,000 fine, or three times the monetary equivalent of the thing of value, whichever is greater. The indictment also seeks forfeiture from all three defendants, if convicted.

An indictment is merely an allegation and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

The case is being investigated by the FBI and the Air Force Office of Special Investigations, Office of Special Projects. The case is being prosecuted by Trial Attorneys Marquest J. Meeks and Edward P. Sullivan of the Criminal Division’s Public Integrity Section, and Assistant U.S. Attorney Carlos A. Esqueda for the District of Utah.”

To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Thirteen Individuals Indicted and Arrested for Conspiracy to Commit Bribery Concerning Programs Receiving Federal Funds and Money Laundering

September 22, 2011

The Federal Bureau of Investigation (FBI) on September 21, 2011 released the following:

“SAN JUAN, PR—On September 16, 2011, a federal grand jury returned a two-count indictment against 13 individuals for conspiracy to commit bribery concerning programs receiving federal funds at the Puerto Rico Department of Education (PRDOE) and conspiracy to commit money laundering, announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. The investigation was led by the U.S. Department of Education, Office of the Inspector General (DOE-OIG), with the collaboration of the Federal Bureau of Investigation (FBI) and the Comptroller’s Office in Puerto Rico.

The defendants and entities are:

  • Luis Conde-Rosa was the chief procurement officer of the Puerto Rico Department of Education;
  • Daniel Erazo-Burgos was the procurement supervisor of the Puerto Rico Department of Education;
  • Juan Carlos Mattei-Marcano was vice-president of School Solutions and president of Janpo, Inc.;
  • Ruben Mattei-Díaz was a principal of School Solutions, Inc. and president of Pochomba, Corp.;
  • Julio Perrone-Mattei was president of School Solutions, Inc.;
  • Mario Rodríguez-Guerra was a Certified Public Accountant and president of Empresas Triunfo, Inc. and Puerto Rico Rainbow Foundation, Inc.;
  • Brenda Velázquez­-Corchado was a procurement officer of the Puerto Rico Department of Education;
  • Olga Díaz-Neris was a procurement officer of the Puerto Rico Department of Education;
  • Luis Santiago-Caro was an employee of School Solutions, Inc. and Service Pro Corp.;
  • Richard Marcano-Díaz was a payment officer of the Puerto Rico Department of Education;
  • Juan Vázquez-Pagán was a payment officer of the Puerto Rico Department of Education;
  • Adonay Ramírez-Vélez was president of Service Pro, Corp.;
  • Carlos Pescador-Charleman was president of Teren, Corp.

The object of the conspiracy was that defendants Juan Carlos Mattei­-Marcano, Ruben Mattei-Díaz, Julio Perrone-Mattei, Mario Rodríguez-Guerra, Luis Santiago-Caro, Adonay Ramírez-Vélez, and Carlos Pescador-Charleman would give money and other goods in order to receive favorable treatment in the awarding of contracts and the expeditious payment of invoices, to defendants Luis Conde-Rosa, Daniel Erazo-Burgos, Brenda Velázquez-Corchado, Olga Díaz-Neris, Richard Marcano-Díaz, and Juan Vázquez-Pagán who would unlawfully enrich themselves by accepting said monies and goods in the awarding of contracts and the expeditious processing of invoices.

The indictment alleges that in or about 2008, continuing through in or about 2009, Erazo­Burgos, Mattei-Marcano, Mattei-Díaz, and Perrone-Mattei agreed that Erazo-Burgos would, in return for cash and goods, direct his procurement officers to favor School Solutions, Service Pro, Corp, and Teren, Corp. in the awarding of contracts. The indictment further alleges that Mattei-Marcano and Mattei-Díaz submitted bids on behalf of all three corporations to defendants Velázquez-Corchado and Díaz-Neris who, in return for cash and goods, favored the three corporations in the awarding of contracts based on the submission of bids, thereby falsely certifying that a competitive bidding process was carried out in accordance with state and federal regulations; and expedited the processing of invoice payments submitted by the three corporations.

In or about April, 2009, Luis Santiago-Caro was introduced to Luis Conde-Rosa at which time Santiago-Caro agreed, with the consent of Juan Carlos Mattei-Marcano, to pay Conde-Rosa 2 percent for all contracts awarded to School Solutions by procurement officers that Conde-Rosa supervised. Mario Rodríguez-Guerra provided consulting, accounting, and tax services to School Solutions, Service Pro Corp, and Teren Corp. In or about 2009, Juan Carlos Mattei-Marcano, Ruben Mattei-Díaz, Rodríguez-Guerra, and Adonay Ramírez-Vélez held multiple meetings wherein the payments to PRDOE employees were discussed. Rodríguez-Guerra advised that they avoid cash withdrawals and instead write checks to themselves which were later cashed and the monies used to pay PRDOE employees.

Over the period of time referred to in the indictment, defendants Mattei-Marcano, Mattei-Díaz, Rodríguez-Guerra, Ramírez-Vélez, and Pescador-Charleman conspired to engage in money laundering related to the bribery scheme described above, by engaging in a series of transactions which were designed to conceal and disguise the nature, location, source, ownership, and control of the proceeds of their unlawful activity, and that while conducting and attempting to conduct such financial transactions, knew that the property involved in the financial transactions represented the proceeds of their unlawful activity. Amongst the defendants, they issued 141 checks totaling $933,139.25 for promotional and internet advertising services and accounting and consulting services that were never provided.

“These individuals are charged with defrauding education programs, with the assistance of public employees who abused their positions for personal gain,” said United States Attorney, Rosa Emilia Rodríguez-Vélez. “We will continue to investigate and prosecute those who engage in corrupt acts which directly affect federal programs and the availability of these funds for its intended recipients,” stated Rodríguez-Vélez.

“Today’s indictment alleges that the defendants knowingly and willfully abused their position of trust for personal gain. That is unacceptable,” said William Hamel, Assistant Inspector General for Investigations of the U.S. Department of Education. “Education is a vital national interest, and our office will continue to protect Federal education funds from this kind of calculated plunder.”

“It is deplorable that individuals charged with the responsibility of assisting in the educational future of our children were engaged in corrupt practices just for mere personal gain. The level of morality of these individuals arrested today is appalling,” said Carlos Cases-Gallardo, Acting Special Agent in Charge of the FBI-San Juan Field Office.

The case is being prosecuted by Senior Litigation Counsel, Assistant United States Attorney Scott Anderson. If found guilty, the defendants could face a possible sentence of 20 years in prison.

Indictments contain only charges and are not evidence of guilt. Defendants are presumed to be innocent unless and until proven guilty.”

To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

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