Two former government officials were arrested Wednesday as a massive corruption indictment was unsealed by U.S. authorities. Julia Keleher, former secretary of education on the island, and Angela Avila-Marrero, who managed Puerto Rico’s Health Insurance Administration, were arrested by FBI agents, along with four other people. The two are accused of directing $15.5 million in government contracts to businesses with which they had ties. Corruption has plagued the island for years, and could complicate matters as it asks for disaster assistance and money to fund basic services.
“Both Keleher and Avila-Marrero took advantage of their privileged positions as agency chiefs,” said Rosa Emilia Rodriguez-Velez, U.S. Attorney for Puerto Rico. “They defrauded the U.S. and Puerto Rican governments.” The Feds also arrested and charged Glenda and Mayra Ponce-Mendoza, a pair of sisters who worked as education consultants, Fernando Scherrer Caillet, an auditing firm executive, and consultant Alberto Velazquez Pinol. The 32-count indictment includes charges of wire fraud, theft, and money laundering. The cash-strapped island has had to resort to contracting out government services, especially health and education, creating conditions which are “ripe for corruption.”
Indeed, corruption scandals are not new on the island, spanning years and administrations. Few residents seemed surprised, although the political establishment was certainly shaken. Gov. Ricardo Rossello cut short his European vacation and flew home immediately. He was not directly implicated in the corruption probe, but quickly landed in hot water anyway. A series of sexist, profanity-laced texts sent by the Governor were uncovered Thursday by the Primera Hora newspaper. Rossello apologized for texts in which he called the former speaker of the New York City Council, who is a political ally of his chief rival, San Juan mayor Carmen Yulin Cruz, a “whore,” and for telling the federal financial oversight board, which has broad fiscal power over the island to “Go F- – – yourself.”
The response on Capitol Hill was just as indignant, though far less colorful. Rep. Raul Grijalva (D-AZ), Chair of the House Natural Resources Committee, which oversees Puerto Rico, called on Rossello to resign. “We’ve crossed that crucible now,” Grijalva told the Washington Post. “The restoration of accountability is so key going forward.” The arrests also bring fresh congressional concerns as the island requests even more federal money: $12 billion to fund Medicaid, and billions more in disaster relief. “Given the news yesterday out of Puerto Rico, we will also need additional program integrity measures in place before we advance this bill out of full committee,” said Rep. Greg Walden (R-OR).
President Trump frequently feuded with Puerto Rico in the aftermath of Hurricane Maria, holding up disaster relief, and charging that the island’s politicians were “grossly incompetent” and corrupt. This week’s arrests probably won’t help their case. Puerto Rico is still trying to exit effective bankruptcy, with federal help, after some forty years of spending more than it took in. Some worried the news would embolden, or even vindicate Trump, including Yulin Cruz, who is running for Governor next year. She argued on Twitter that disaster aid “should not be ‘weaponized’ and used for political purposes.” Yet, as Yulin Cruz told The Post, “the governor of Puerto Rico and his administration have now given President Trump the ammunition he needed.”