General · March 23, 2021 0

6 Individuals Indicted And Arrested On Wire Fraud Charges

Seven Individuals Indicted And Arrested On Wire Fraud Charges In Relation To A Scheme To Defraud The Municipality Of Mayagüez

The defendants are facing a forfeiture allegation of $7,200,000.00

SAN JUAN, P.R (STL.News) On March 22, 2021, a Federal Grand Jury in the District of Puerto Rico returned an indictment charging seven individuals with thirty-three counts of wire fraud and money laundering.  W. Stephen Muldrow, United States Attorney, District of Puerto Rico and Tyler R. Hatcher, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Miami Field Office, and Rafael Riviere-Vázquez, Special Agent in Charge of the FBI, San Juan Field Office, made the announcement.

“The defendants charged in this conspiracy were trusted to invest public money for the benefit of the municipality of Mayagüez and the western area, but instead they used part of it for personal gain and expenses, defrauding the government,” said U.S. Attorney Muldrow.  “We will continue to focus on these types of fraud schemes and work with our law enforcement partners to bring the defendants to justice.”

Acting Special Agent in Charge Tyler R. Hatcher, of IRS Criminal Investigation, Miami Field Office, said: “Persons in a position of trust that use public monies to perpetrate fraud for personal enrichment betray the trust of the citizens they are supposed to serve.  These funds were designated to improve the quality of life of the citizens for a region of Puerto Rico and this fraud will not go unpunished.  We are all responsible for complying with laws, regardless of position of influence.  IRS Criminal Investigation along with our law enforcement partners will continue our collective efforts to enforce the law and foster public trust.”

“The FBI is committed to fight fraud at every level.  This case is the result of patient, detail-oriented, hard work. I’d like to thank our dedicated team as well as our IRS partners for their continued support to the FBI mission,” said Rafael Riviere-Vázquez, Special Agent in Charge of the FBI, San Juan Field Office.

The indictment alleges that from March 2016 to June 2018, defendants Eugenio García-Jiménez, a.k.a. “Gino”; Stephen Kirkland, a.k.a. “Steve”; Steve Minger; Alejandro Riera-Fernández; Joseph Kirkland; Arnaldo J. Irizarry-Irizarry; and Roberto Mejill Tellado orchestrated a scheme to defraud the municipality of Mayagüez and Mayagüez Economic Development Inc. (hereinafter “MEDI”) of monies belonging to Mayagüez, by falsely representing that the totality of $9,000,000 in principal belonging to Mayagüez and entrusted to MEDI for investment was in fact invested and yielding a significant rate of return.  MEDI is a domestic for-profit public corporation created with the purpose of promoting the economic development of Mayagüez and the western region of Puerto Rico, creating jobs, supporting infrastructure projects, and improving the quality of life of citizens.  The defendants transferred, distributed, and spent the money in ways inconsistent with the representations made to Mayagüez and MEDI about the investment of the money, to include purchases of: a marine vessel, jewelry, clothing, school tuition, restaurants, utilities, credit card payments, and home décor, as well as real estate improvements (pools, for example) and the payment of home mortgages.

Using multiple shell corporate entities and financial accounts, defendants collectively received hundreds of thousands of dollars belonging to Mayagüez, intended for investment, which defendants then used for personal expenses and purchases of personal and real property.  The use of shell corporate entities further served to conceal the scheme to defraud Mayagüez and MEDI and allowed defendants to lull Mayagüez and MEDI into believing that the nine million dollars was invested as falsely represented by defendants.  Of the nine million dollars obtained from the municipality through material misrepresentations, the defendants only returned $1,800,000 to Mayagüez and in doing so, falsely represented that the $1,800,000 was a return on investment.

If found guilty, the defendants face a maximum statutory sentence of up to 20 years in prison and a fine up to $250,000 for charges relating to wire fraud, and up to 10 years in prison for the money laundering charges.

U.S. Attorney W. Stephen Muldrow commends the investigative efforts of IRS-CI’s Miami Field Office and the FBI.  This case is being prosecuted by Assistant U.S. Attorneys Myriam Fernández, Chief of the Asset Recovery and Money Laundering Unit and Seth A. Erbe, Chief of the Financial Fraud and Public Corruption Unit.  An indictment contains only charges and is not evidence of guilt.  All defendants are presumed to be innocent unless and until proven guilty.

SOURCE: USDOJ.Today

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