A Former Employee and a Contract Worker of Medtronic-CR Indicted for Conspiring to Defraud the Company of Over $1M and Launder their Proceeds
SAN JUAN, Puerto Rico – A federal grand jury in the District of Puerto Rico returned an indictment charging defendants Elieser Feliciano-Soto and José E. Santana-Criado with agreeing to benefit and enrich themselves by obtaining money and property belonging to Medtronic Medical CR SRL (Medtronic-CR) through a wire fraud scheme. The defendants are also charged with a money laundering conspiracy involving transactions, using the stolen proceeds, in excess of $10,000. The indictment includes a forfeiture allegation related to the total value of the loss, approximately $1,151,296.38, and two residential properties.
As alleged in the indictment, Medtronic-CR was a Costa Rica limited liability company that manufactured orthopedic components used for spine surgery devices and spine surgery procedures, which are distributed and sold globally. As part of its expansion plans, in or about 2017, Medtronic-CR set out to build a new manufacturing facility in Coyol Alajuela, Costa Rica.
Elieser Feliciano-Soto was the Site Director for Medtronic-CR and was in charge of overseeing the construction of the new manufacturing facility. José E. Santana-Criado, a contract worker for Medtronic-CR, organized Innovative Engineering Corp. and Innovative Engineering LLC (collectively referred to as Innovative) in Puerto Rico. The defendants used Innovative to fraudulently obtain payments from Medtronic-CR for the purported provision of services which were never rendered.
Elieser Feliciano-Soto used his position as Site Director to authorize purchase orders issued by Innovative for the purpose of defrauding Medtronic-CR. The purchase orders authorized services to be rendered by Innovative. Once the purchase orders were approved, the defendants submitted fraudulent invoices from Innovative to Medtronic-CR for services which were never provided. Innovative would then receive electronic wire transfer payments from Medtronic-CR’s bank account in Costa Rica to Innovative’s bank account in Banco Popular de Puerto Rico (BPPR) corresponding to payments for Innovative’s invoices.
The defendants then transferred the wire fraud proceeds from Innovative’s bank account to other accounts that they controlled in BPPR and Baxter Credit Union (BCU) in Illinois. The wire fraud proceeds were used to financially enrich themselves, including to pay the mortgages for real property in Cabo Rojo and Humacao, Puerto Rico.
Pursuant to the indictment, the defendants are charged with conspiracy to commit wire fraud in violation of 18 U.S.C. § 1349, and a money laundering conspiracy in violation of 18 U.S.C. § 1956(h). If convicted, the defendants face a sentence of up to 20 years in prison for each offense.
U.S. Attorney W. Stephen Muldrow of the District of Puerto Rico; and Joseph González, Special Agent in Charge of the FBI made the announcement.
The FBI is investigating the case.
Assistant US Attorney Víctor O. Acevedo-Hernández is prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.