WASHINGTON — Assistant Attorney General Alice S. Fisher of the Criminal Division announced today that a jury in San Juan, Puerto Rico found two defendants guilty of conspiracy, extortion, and fraud in connection with a public corruption investigation into a construction project in Puerto Rico known as Superaqueduct. The Honorable Jose Antonio Fuste scheduled the sentencing for Jan. 18, 2007.
In early 1995, the defendants, ReneVazquez-Botet and Marcos Morell-Corrada extorted money from engineering and construction contractors based in Puerto Rico who obtained contracts for the construction of Puerto Rico’s Superaqueduct, a $372 million project that included the construction of a 50-mile water pipe from the west to the east of the island. The indictment alleged that Vazquez-Botet and Morell-Corrada demanded more than $2 million from the contractors for assistance in securing and preserving their Superaqueduct contracts.
Vazquez-Botet, 51, held a variety of positions with the political party which controlled the executive branch in Puerto Rico during the relevant period. He is also a pediatric ophthalmologist. Under the extortion scheme, between 1996 and 1999 he is alleged to have received cash payments totaling over $300,000 and to have directed that payments be made to third-parties totaling approximately $80,000. The indictment also charges that Vazquez-Botet fraudulently concealed the extortionate payments and other income on his income tax returns for the Commonwealth of Puerto Rico.
Morell-Corrada, 58, served as the Secretary General of the same political party as Vazquez-Botet from 1991 until his resignation in 1996, when he resumed the private practice of law. The indictment alleges that he received approximately $125,000 between September 1997 and May 1999, mostly under the guise of a sham retainer agreement for legal services. He is also alleged to have received payments in the form of purchases of appliances for his residence; the payment of fees he incurred for architectural services related to a building he was rehabilitating; car rentals; and a donation to a basketball team with which he was associated. According to the indictment, Marcos Morell-Corrada fraudulently concealed a portion of his income from the extortion scheme on his tax returns for the Commonwealth of Puerto Rico.
The 14-count indictment charged the defendants with conspiring to commit Hobbs Act extortion, mail and wire fraud. The jury found both defendants guilty on Counts 1- 4 (Conspiracy and three counts of Hobbs Act Extortion); defendant Vasquez-Botet was found guilty on Counts 6-8 (Mail and Wire Fraud); defendant Morrell-Corrada was found guilty on Counts 9 -11, and 13 (Mail and Wire Fraud as to defendant Morrell-Corrada only). Both defendants were acquitted on Count 5 (Hobbs Act Extortion). Defendant Morrell-Corrada was also acquitted on Count 12 (Wire Fraud) and Count 14 (Obstruction of Justice).
This case was tried by Trial Attorneys Mary Butler and Matthew Solomon of the Public Integrity Section of the Criminal Division, U.S. Department of Justice, headed by Acting Section Chief Edward C. Nucci, and investigated by the FBI.s San Juan Division, headed by Special Agent in Charge Luis S. Fraticelli. The Office of the Comptroller for the Commonwealth of Puerto Rico provided assistance in the investigation. The United States Attorney.s Office for the District of Puerto Rico is recused from this matter.
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