At a time when Puerto Rico’s collapsed power grid was costing lives, two top Federal Emergency Management Agency (FEMA) officials and former president of energy company Cobra Acquisitions, LLC, were allegedly conspiring to commit fraud in disaster relief funds after hurricanes Irma and María.
Yesterday, federal authorities arrested Ahsha Nateef Tribble, FEMA´s former deputy regional administrator of FEMA region II – in New York – and who worked in Puerto Rico after the hurricanes; former Cobra Acquisitions LCC President Donald Keith Ellison; and Jovanda R. Patterson, FEMA deputy chief of staff in Puerto Rico, after a grand jury charged them with 15 counts of corruption on September 3.
Charges are related to contracts awarded by the Electric Power Authority (PREPA) to the company that was to work on the repair of the island's power grid.
"At the cost of our suffering ... they took advantage of the most vulnerable moments the people of Puerto Rico were living through to enrich themselves," U.S. District Attorney Rosa Emilia Rodríguez Velez said at a press conference.
In addition to alleged disaster relief funds fraud, both Ellison and Tribble face eight and ten charges respectively of conspiracy to commit bribery, committing acts affecting personal financial conflicts of interest; making false statements; honest services wire fraud; and Travel Act violations, Rodríguez Vélez detailed.
Patterson was charged with committing acts affecting personal financial conflicts of interest and wire fraud.
She resigned from her position at FEMA in July 2018 to work for Cobra Energy LLC, said the federal prosecution.
Ellison was president of Cobra until June 2019, while Tribble was placed on administrative leave in May amid the investigation into Cobra.
Charges come two weeks after President Donald Trump attacked Puerto Rico, its people, and its political class by saying on Twitter that the island is the "most corrupt" place on Earth, that local politicians are " incompetent ”and that Puerto Ricans have not been grateful for the federal government's response to the emergency triggered by Hurricane María.
However, yesterday by press time, the President had not made any statement regarding the arrests of these former federal officials.
Meanwhile, Governor Wanda Vázquez Garced described the arrests as "reprehensive" and "outrageous."
“These defendants, according to the accusation, misused and took advantage of the need and pain that Puerto Rico faced after the passage of Hurricane Maria. We reproach corruption, wherever it comes from and it is why we work every day to strengthen the measures to identify possible behaviors of thiskind, that seek to take advantage of the need and pain of a people,” said the governor.
Resident Commissioner Jenniffer González said yesterday's events are evidence that the federal government is not exempt from such acts.
"That shows that corruption is everywhere, not just in the Puerto Rican government... The (federal) agencies that handle the funds have also had their internal failures," the Commissioner said.
Multi-million dollar contracts
Cobra Acquisitions was awarded two contracts with PREPA for almost $ 1.9 billion to repair the power grid. Cobra became the corporation’s main contractor as to recovery work.
Work performed under both contracts was paid through PREPA with federal funds from FEMA, according to the indictment.
Yesterday, PREPA’s Executive Director José Ortiz said that when he became aware of possible irregularities related to recovery efforts after Hurricane María, he canceled contracts with Cobra in March 2019.
However, by March 31, PREPA had already paid $ 1,1 billion to the company, Ortiz confirmed.
"The difference is due to unused amounts and billing disputes," Ortiz said in written statements.
Representing Cobra, contracts and amendments to the first agreement were signed by a company executive identified in the indictment as "individual A" who was not among those charged yesterday.
On behalf of PREPA, the first contract for $ 200 million was signed by former Executive Director Ricardo Ramos on October 19, 2017.
After that, a first amendment signed by former Executive Director Justo González for an additional $ 245 million. A second amendment was made to the contract, also signed by González, adding another $ 500 million.
The second contract was awarded to Cobra on May 26, 2018, and signed by former Executive Director Walter Higgins, who appeared before the grand jury in early August.
On the total paid to Cobra, neither PREPA nor FEMA said how much was reimbursed to the utility or how federal charges and the ongoing investigation could still affect those reimbursements.
Ortiz said he will soon request a meeting with FEMA officials to determine the next steps to follow, in light of the charges against FEMA officials.
Federal authorities said yesterday that assets and property, allegedly resulting from fraud will be seized. The value of the assets detailed in the indictment totals nearly $5 million.
“These defendants were supposed to come to Puerto Rico (in 2017) to help during the recovery after the devastation suffered from Hurricane María. Instead, they decided to take advantage of the precarious conditions of our electric power grid and engaged in a bribery and honest services wire fraud scheme in order to enrich themselves illegally,” said U.S. Attorney Rosa Emilia Rodríguez-Vélez
“The accusation we announce today demonstrates how a top FEMA official and the president of Cobra company agreed to enrich themselves illegally at the expense of the repair work on our electrical system after the passing of hurricanes Irma and María in September of 2017,” Rodríguez-Vélez added.
“They decided to take advantage of the precarious conditions of our electric power grid and engaged in a bribery and honest services wire fraud scheme in order to enrich themselves illegally,” she said
FEMA calls for "trust"
According to the indictment, “Tribble and Ellison developed a personal relationship wherein Ellison provided Tribble with things of value with the intent to influence Tribble’s performance of official acts. In exchange, Tribble performed official acts, including influencing, advising, and exerting pressure on PREPA and FEMA officials, in order to award restoration work to COBRA and accelerate payments to COBRA. ”
Rodríguez-Vélez recalled, for example, that after the explosion at PREPA’s Monacillos Transmission Center in San Juan in February 2018, Tribble put pressure on PREPA executives to use Cobra employees to repair that center, despite the fact that PREPA officials allegedly insisted on using state employees.
“FEMA cannot comment on personnel matters. However, the agency is fully cooperating with federal investigators, ”said Daniel Llargués, FEMA national spokesman, in written statements, while asking for a vote of confidence from the people.
"FEMA's mission is to help people before, during and after disasters, and our mission can only be accomplished by maintaining the trust of the public and those we serve," he said.
Llargués said the agency takes allegations of employee misconduct extremely seriously and puts them under rigorous ethical standards.
Rodríguez-Vélez ruled out that up to this point in the investigation any PREPA official might be involved in the alleged scheme.
"We have at this moment no indication that any PREPA executive is involved," she said. "This lady (Tribble) had such a high position at FEMA here, that what she said was the law," she added.
The defendants appeared yesterday before a judge in the jurisdictions where they were arrested and will later be brought to the island, Rodríguez Vélez said. Tribble was arrested in Florida, and Ellison in Oklahoma, while Patterson was arrested in California.
The U.S. Department of Homeland Security´s Office of the Inspector General and FBI agents conducted the investigation.
The indictment states that “Ellison provided Tribble with personal helicopter use, hotel accommodations, airfare, personal security services, and the use of a credit card,” including tickets to Orlando and Washington D.C. and also multiple first-class tickets from San Juan to New York. And the indictment adds that “as part of Ellison’s pattern of providing things of value to Tribble, he also secured employment within COBRA’s affiliated companies for her friend, defendant Patterson.”