8 Subjects Charged and Arrested om Department of Education Federal Program Fraud Scheme. Hato Rey, PR, April 29, 2008

Published by the Department of Education, Office of Inspector General on 2008-04-29.

Below is a raw (and likely hideous) rendition of the original report.

OIG Investigative Reports,  8 Subjects Charged and Arrested om Department of Education Federal Program Fraud Scheme
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Rosa Emilia Rodriquez-Vélez
United States Attorney;
District of Puerto Rico
Torre Chardón Bldg., Suite 1201(787) 766-5656
350 Chardón Avenue
Hato Rey, Puerto Rico 00918
Date:  April 29,2008
Contact:  U.S. Attorney's Office
Lymarie Llovet
Public Affairs Specialist
8 Subjects Charged and Arrested om Department of Education Federal Program Fraud Scheme
San Juan, Puerto Rico- A federal Grand Jury returned a thirteen count indictment last Friday, April 25, 2008, charging eight (8) individuals who were part of a conspiracy and fraud scheme involving the Department of Education. The arrests were announced today by Rosa Emilia Rodriguez Vélez, United States Attorney for the District of Puerto Rico, Luis S. Fraticeili, Special Agent in Charge, San Juan Division of the Federal Bureau of Investigation (FBI) and John P. Higgins, Jr., Inspector General of the U.S. Department of Education. The individuals were charged with violations of Title 18, United States Code, Sections 371, 666 (a)(1)(A) and 2, ware arrested today. Forfeiture counts ware also included pursuant to Title 18, United States code, Sections 981(a)(1)(D) and 982.
The fraud scheme involved the Director and staff of the Puerto Rico Department of Education's Community Integrated Services Program (CISP). This program provided educational and vocational training offerings in special communities gad public hauling projects, such as tutoring for the GED exam, library services, job search fairs, drug prevention and child abuse conferences. These services would be provided to single mothers and fathers, pregnant teenagers, and unemployed persons. The services were provided through individuals who were awarded personal services contracts.
In order to provide services and obtain federal funds, the CISP had to submit proposals to the Puerto Rico Department of Education's Office of Federal Affairs. The CISP received federal funds from the Adult Education Program and from the Safe and Drug Free Program. During award years 2002 2003 through 2005 2006, the Puerto Rico Department of Education received approximately $21 million dollars per year for the Adult Education Program, and $11 million dollars for the Safe and Drug Free Program.
During the years 2002 through 2006, the scheme perpetrated by the defendants involved approximately four hundred and fifty thousand dollars ($450,000). The investigation revealed that the defendants unjustly enriched themselves by fraudulently obtaining moneys from the Puerto Rico Department of Education, purportedly for services rendered to beneficiaries in special communities and public housing projects, including educational and vocational training, through personal services contracts awarded by the Puerto Rico Department of Education's CISP to the defendants, their family members, acquaintances, former independent contractors of the Puerto Rico Department of Education, or simply to fictitious contracting parties. The defendants, themselves and through acquaintances and other third parties, submitted false invoices for services that were not provided, end received payments to which they were not entitled.
The thirteen–count indictment was issued by a federal grand jury on April 25, 2008. The following individuals were indicted: (1) Edwin Jiménez Irizarry, Director of the Puerto Rico Department of Education's Community Integrated Services Program; (2) Ivette Hernaiz Rivera, worked as an Administrative Secretary at the Puerto Rico Department of Education 's Community Integrated Services Program; (3) Ana I. Pantojas Maldonado worked as an Administrative Auxiliary; (4) William Diaz Meléndez also worked as an Administrative Auxiliary; (5) Celida M. Martinez Pérez, wife of defendant Edwin Jimenez Irizarry; (6) Gladys Torres-¬Santiago, a close acquaintance to defendant Jimenez lrizarry and had a contract; (7) Jose R. Lebrun Robles, husband of defendant Ivette Hernaiz Rivera, (8) Roselia Rivera Rosa is the mother of defendant Ivette Hernaiz Rivera.
"This indictment proves once again the successful collaboration of state and federal law enforcement agencies to fight public corruption in Puerto Rico. The employees accused betrayed the trust that the Department of Education had in them to manage federal funds. They fraudulently used federal monies earmarked to assist the community for their own personal benefit, thereby affecting the education and opportunities of those who were the intended beneficiaries of these funds, the people of Puerto Rico", said U.S. Attorney Rosa Emilia Rodriguez Vélez.
"As I have stated previously, these fraudulent schemes ultimately hurt the less fortunate and the individuals who are in real need of these services and funds," said Luis Fraticelli, Special Agent in Charge of the Federal Bureau of Investigation (FBI), San Juan Field Office. "The Community Integrated Services Program is designed to provide services to single mothers and fathers, pregnant teenagers, children and unemployed individuals in order to assist them in obtaining a GED, drug prevention, child abuse seminars, job search fairs, etc., so as to help them prosper within the community."
"I am proud of the work of our Special Agents and would like to commend our fiends and colleagues in the FBI, U.S. Attorney's Office and the Puerto Rico Office of the Comptroller whose efforts helped bring about today's action," said John P. Higgins, Jr., Inspector General of the U.S. Department of Education. "OIG is committed to aggressively pursuing those who misuse or abuse federal education dollars, and we will continue to work with our colleagues to ensure these vital funds reach the intended recipients -- our students."
The penalties for these charges are a maximum term of imprisonment of 20 years and a maximum fine of $500,000.00 dollars, The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial and the government has the burden of proving guilt beyond a reasonable doubt.
This indictment is the result of a joint investigation conducted by agents of the OIG and FBI, with the collaboration of the Office of the Comptroller of Puerto Rico, The investigation and prosecution of this case is assigned to Assistant U.S. Attorney Jenifer Hernandez.
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Last Modified: 05/02/2008
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