Two Individuals Indicted For Fraud Concerning Program Receiving Federal Funds, Bribery, And Aggravated Id Theft
SAN JUAN, P.R. – On April 19, a federal grand jury returned a six-count indictment charging Edgar Arroyo-Amezquita and Luis Serrano-Perdigón with conspiracy to obtain property by fraud from a program receiving federal funds, bribery concerning programs receiving federal funds, aggravated identity theft, and giving a false statement to federal authorities, announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. The Federal Bureau of Investigation is in charge of the investigation.
According to the indictment, from May 2011 through in or about May 2013, defendants Arroyo-Amezquita and Serrano-Perdigón conspired to commit an offense against the United States: theft concerning programs receiving federal funds. The object of the conspiracy was to use Arroyo-Amezquita’s official position as Director of the Facilities Department within the government of the Municipality of Toa Baja, PR, to benefit and enrich themselves and steal and obtain by fraud property worth at least $5,000 and under the custody and control of the Municipality of Toa Baja.
The defendants submitted material false and misleading quote documentation to personnel of Toa Baja in order to fraudulently obtain municipal contracts and monetary payments. They used a fictitious company, Professional Sales & Service, using the name and signature of a real person with initials J.M. despite the fact that J.M. was not aware of the quotes or the use of his name and signature to submit quotes for contract work from the municipality. They also used a fictitious social security number and email account so payments would be processed under the name Professional Sales & Service and the company would appear legitimate.
Arroyo-Amezquita and Serrano-Perdigón agreed on a price for the work to be performed and then agreed to increase the quote amount submitted under Professional Sales & Service. Arroyo-Amezquita and Serrano-Perdigón also submitted inflated quotes under the name of a company controlled by Serrano-Perdigón, A.L.S. Electronic Service (ALS), so that quotes under the name of Professional Sales & Service would have the lowest cost. Arroyo-Amezquita used his position to deliver quotes to the municipal purchaser with instructions to immediately process the paperwork for the contract at issue, preventing the purchaser from obtaining other quotes or otherwise determining the fictitious nature of Professional Sales & Service.
Contracts awarded to Professional Sales & Service were completed by Serrano-Perdigón or an employee or subcontractor designated by Serrano-Perdigón. After contracts were awarded and payments were made by the municipality to Professional Sales & Service, Serrano-Perdigón would deposit the checks into a bank account he controlled in the name of ALS. Serrano-Perdigón then made cash payments to Arroyo-Amezquita intending to influence and reward Arroyo-Amezquita. From 2011 to 2013, over $140,000 in contracts were awarded and paid by the Municipality of Toa Baja to Professional Sales & Service.
“These defendants knowingly participated in a scheme to defraud the Municipality of Toa Baja which, like many other municipalities in Puerto Rico, is facing dire financial straits, for their personal economic gain,” said Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. “We remain committed to investigating and prosecuting financial crimes and fraud and will hold those who take advantage of their positions, accountable for their actions.”
If convicted, the defendants face a maximum sentence of five (5) years of imprisonment for the conspiracy to obtain property by fraud from program receiving federal funds, a maximum sentence of ten (10) years imprisonment for bribery concerning programs receiving federal funds, two (2) to four (4) years mandatory imprisonment for the aggravated identity theft charges, and a maximum sentence of five (5) years of imprisonment for lying to federal authorities. The case is being prosecuted by Assistant United States Attorney Seth Erbe. An indictment contains only charges and is not evidence of guilt. Defendants are presumed to be innocent unless and until proven guilty. The investigation is ongoing.
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