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Five Sentenced In Puerto Rico Corruption Case

CaribWorldNews, SAN JUAN, Puerto Rico, Tues. May 26, 2009: Five Puerto Rico nationals have been sentenced for their participation in a corruption scheme involving the 2000 resident commissioner and 2004 gubernatorial campaigns of a former governor of Puerto Rico.  

Those sentenced by U.S. District Court Judge Paul J. Barbadoro were San Juan residents Jorge Velasco Mella, 39;  Ramon Velasco Escardille, 50 and Miguel Nazario Franco, 62 as well as  Edwin Colon Rodriguez, 36, of Arecibo and Jose Gonz a lez Freyre, 56, of Guaynabo.

Mella was sentenced to three years probation, including 12 months of home detention after pleading guilty on Jan. 23, 2009, to one count of conspiracy to violate the Federal Election Campaign Act.
 
Escardille was sentenced to three years probation, including 12 months of home detention after pleading guilty on Jan. 23, 2009, to one count conspiracy to violate FECA while Rodríguez was sentenced to 12 months and one day in prison, and three years supervised release following the prison term after pleading guilty on Jan. 23, 2009, to one count of making a false statement to the Federal Election Commission.
 
Freyre was sentenced on May 22, 2009, to one year probation, including six months of home detention, and a $5,000 fine after pleading guilty on Feb. 2, 2009, to one count of making a false statement to the FBI and the Internal Revenue Service while Franco was sentenced to one year probation, including six months of home detention, and a $5,000 fine after pleading guilty on Jan. 23, 2009, to one count of misprision of a felony.  

Former Puerto Rico Governor Anibal Acevedo Vila , 47, and Luisa Inclán Bird, 49, a legal advisor for the San Juan resident commissioner office when Acevedo Vilá served as resident commissioner, were acquitted on March 20, 2009, of all criminal charges related to the scheme.    

According to plea documents, Velasco Mella, Velasco Escardille and Colon Rodriguez admitted to participating in a scheme to defraud the United States and violate various FECA provisions by having Puerto Rico and Philadelphia-area businessmen make illegal and unreported contributions to pay off large and unreported debts stemming from the former governor`s campaign in 2000 for resident commissioner of the Commonwealth of Puerto Rico.  

The defendants admitted that the scheme involved soliciting, accepting, and then reimbursing illegal conduit contributions from the candidate`s family members and staff.   Conduit contributions are illegal campaign contributions made by one person in the name of another person.   According to plea documents, payments were made principally to the campaign`s public relations firm, Lopito, Ileana and Howie.   Also, the illegal actions continued into 2003, due to the significant debt accumulated by the campaign, some of which was also concealed from the FEC and the public.  
 
According to court documents, the scheme continued through unreported fundraising and the making of unrecorded vendor payments for the former governor`s 2004 gubernatorial campaign in order to raise and spend far more than the limited amount that Puerto Rican law permitted.   According to court documents and the statements of the defendants who pleaded guilty, Puerto Rico businessmen, described in court documents as collaborators, used large amounts of money from their personal or corporate funds to pay for large and unreported debts to the campaign`s public relations firm.   Large sums of cash were also used to keep contributions and vendor payments concealed from the Puerto Rico Treasury Department and the public.  

Court papers also reveal that for many of the collaborator payments, the public relations company created fake invoices to make the payments appear to be legitimate business expenses of the collaborators` companies.   As Finance Director for the 2004 gubernatorial campaign, Nazario Franco became aware of this illegal activity and pleaded guilty for failing to report it.   Gonz á lez Freyre pleaded guilty to making a false statement during the federal investigation into his illegal $50,000 contribution to the 2004 gubernatorial campaign.   
 
A total of nine defendants have pleaded guilty in the ongoing corruption investigation in the District of Puerto Rico.  In addition to the five defendants sentenced this week, the others are Salvatore Avanzato, Marvin Block, Candido Negron and Ricardo Colon.