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A corruption scheme in Puerto Rico reveals the existence of an extensive network involving bankers and public officials in alleged cases of bribery, money laundering, influence peddling, and other alleged crimes.
The scandal came to light following the arrest of the former governor of Puerto Rico, Wanda Vázquez, for irregularities in her 2020 political campaign financing. Although the former governor pleaded not guilty in court, her case involved high-ranking officials on the island. A political consultant to the former governor and the president of Bancredito International Bank have already pleaded guilty to participating in the bribery.
Vázquez was arrested last Thursday by FBI agents at her residence but was later released on bail. The former governor faces charges of conspiracy, federal program bribery, and wire fraud.
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Also accused in the case are Venezuelan banker Julio Herrera Velutini and former FBI agent Mark Rossini; the latter turned himself into authorities on Tuesday, August 9th, although he assures that he is innocent.
The U.S. Attorney for Puerto Rico, W. Stephen Muldrow, explained in a press conference that the former governor, Herrera, and Rossini could face a maximum sentence of 20 years in prison if convicted.
According to the indictment, Herrera and Rossini allegedly paid more than $300,000 to political consultants in support of Vázquez’s campaign in exchange for her firing the commissioner of the regulatory agency Financial Institutions (OCIF), which was investigating Herrera’s bank, Bancrédito International Bank.
The situation has been so severe that Bancrédito decided to cease operations in Puerto Rico.
This case adds to those of several mayors, former mayors, and high-ranking officials who have been arrested and charged with corruption and accepting bribes in the last year in Puerto Rico.
Others involved in the scheme
Mark Rossini: Former FBI agent turned himself in Tuesday to federal authorities on the island and pleaded not guilty. The attorney general’s office told The Associated Press (AP) that Rossini’s attorney contacted authorities days after former Gov. Wanda Vazquez was arrested.
— Melissa Correa (@melissaivelise) August 11, 2022
Rossini is charged with conspiracy, bribery in a federal program, and wire fraud. He pleaded not guilty during a hearing in which the judge authorized him to live in the United States but not in Spain, where he is undergoing cancer treatment. However, the judge stated that he could travel to Spain for his illness.
Authorities say Rossini provided consulting services to Herrera Velutini when both allegedly promised to financially support Vazquez’s 2020 campaign with more than $300,000.
Rossini was an FBI agent from 1991 to 2008, when he resigned as part of a plea deal in which he pleaded guilty to criminally accessing an FBI database for personal purposes.
Julio Herrera Velutini: Herrera, a Venezuelan-Italian dual national, was the owner of Bancredito International Bank, which operated in San Juan.
It is reported that the former governor accepted the banker’s bribe offer. In February 2020, she demanded the commissioner’s resignation and appointed a former consultant of the international bank owned by Herrera.
Herrera has not yet been arrested. Federal authorities say he is in the United Kingdom.
According to federal authorities, after Vázquez’s defeat in the primaries, Herrera and Rossini conspired to bribe the winner and current governor, Pedro Pierluisi; however, U.S. Attorney Stephen Muldrow clarified that the governor was not involved in the scheme.
In March of this year, former Public Housing Administrator John Blakeman, along with Frances Díaz, general director of Bancrédito, reached an agreement with the U.S. Attorney’s Office to plead guilty to bribery and conspiracy charges. Blakeman assisted in the former governor’s primary campaign finances.
Corruption in Puerto Rico: A Pandora’s Box
In the last four years, federal authorities have charged two former and six mayors with corruption.
According to Comptroller Yesmín Valdivieso, the annual losses caused by acts of corruption in Puerto Rico are estimated at 10% of the government budget.
In May of this year, FBI agents arrested the mayors of Aguas Buenas and Humacao, Javier García Pérez and Reinaldo Vargas Rodríguez, respectively, also accused of corruption.
Also, that same month, the Popular Democratic Party (PDP) mayor of Guayama, Eduardo Cintrón, pleaded guilty to receiving illegal commissions in exchange for favoring an asphalt company that paid him kickback for each square meter of asphalt paved in the municipality, turned himself in.
Last December, a local media investigation revealed that Vargas received cash from businessman Oscar Santamaría, president of Waste Collection, a company dedicated to garbage and debris collection.
In mid-December, the former mayor of Aguas Buenas, Luis Arroyo Chiques, also turned himself into the authorities for receiving monthly kickbacks of $5,000 from a waste collection company in exchange for securing a 10-year contract in the municipality.
Trujillo Alto’s former PDP mayor, José Luis Cruz, pleaded guilty to one count of conspiracy to commit bribery and receive kickbacks. The investigation indicates that the company paid him 75 cents in illegal commissions for each house from which they collected solid waste.
In November of last year, New Progressive Party (NPP) Guaynabo Mayor Angel Perez Otero was also arrested for conspiracy to receive kickbacks, bribery with federal programs, and extortion through official rights.
According to the indictment, Pérez Otero received weekly payments of $5,000 from 2019 through May to secure and maintain specific municipal contracts.
In Puerto Rico, however, it is not only mayors and governors who have been arrested. Julia Keleher, the former secretary of the Education Department under the Ricardo Rosselló administration, was arrested in July 2019 and pleaded guilty to two felony counts of conspiracy to commit wire fraud.
Former New Progressive Party (NPP) representative Nelson Del Valle Colón pleaded guilty at the federal level to a bribery scheme. Two of his female employees also pleaded guilty after being indicted along with the former official in 2020.
María Milagros ‘Tata’ Charbonier, a former New Progressive Party representative, was arrested in August 2020 along with her husband, her son, and an employee of her office. All face charges of theft of federal funds, honest services fraud, money laundering, and obstruction of justice.
Sabrina Martín Rondon is a Venezuelan journalist. Her source is politics and economics. She is a specialist in corporate communications and is committed to the task of dismantling the supposed benefits of socialism // Sabrina Martín Rondon es periodista venezolana. Su fuente es la política y economía. Es especialista en comunicaciones corporativas y se ha comprometido con la tarea de desmontar las supuestas bondades del socialismo