Federal Grand Jury in El Paso Indicts 11 in Corruption Investigation
Charges Include Racketeer Influenced and Corrupt Organizations Act Violation
|U.S. Attorney’s Office September 02, 2010|
United States Attorney John E. Murphy and Federal Bureau of Investigation Special Agent in Charge David Cuthbertson announced today that a federal grand jury has indicted 11 individuals in connection with the El Paso corruption investigation.
The indictment, returned on Tuesday and unsealed today, charges 47-year-old El Paso business executive Francisco "Frank" Apodaca, Jr. and 53-year-old El Paso public relations consultant Marc Schwartz with a Racketeer Influenced and Corrupt Organizations (RICO) Act conspiracy violation as well as two counts of conspiracy to commit mail fraud and deprivation of honest services; two counts of mail fraud, aiding and abetting, and deprivation of honest services; and two counts of conspiracy to commit mail and wire fraud and deprivation of honest services. The indictment also charges 51-year-old former El Paso County Commissioner Larry Medina with a RICO violation, one count of conspiracy to commit mail fraud and deprivation of honest services, and one count of mail fraud, aiding and abetting, and deprivation of honest services. Also, 64-year old El Paso attorney Luther Edward Jones, 42-year-old former El Paso County District Clerk Gilbert Sanchez, 62-year-old attorney David Escobar, 64-year-old former president of the board of trustees for the Ysleta Independent School District (I.S.D.) Milton "Mickey" Duntley, 61-year-old Soccoro I.S.D. Trustee Charles "Charlie" Garcia, and 57-year-old Soccoro I.S.D. Trustee Raymundo "Ray" Rodriguez are charged with a RICO violation and one count of conspiracy to commit mail and wire fraud and deprivation of honest services. Finally, the indictment charges 60-year-old Soccoro I.S.D. Trustee Guillermo "Willie" Gandara, Sr. and 60-year-old Ysleta I.S.D. Trustee Linda Chavez with one count of conspiracy to commit mail and wire fraud and deprivation of honest services
The indictment centers around a now-defunct vender, ACCESS Health Source. ACCESS, among other things, was a third party administrator of healthcare benefits for self insured entities. Between 1998 and 2007, ACCESS contracted with self-insured local (El Paso) government entities, including the county and three school districts, to provide administrative services for their health insurance programs. The indictment alleges that, in order to obtain and maintain these lucrative healthcare services contracts, ACCESS conspired to engage in a pattern of racketeering activity, including mail fraud, wire fraud, and bribery, through it’s owner, Robert Jones, CEO/President Frank Apodaca, and public relations contractor Marc Schwartz. This indictment alleges ACCESS conspired to commit fraud and bribery with elected and appointed members of the El Paso County Commissioners Court and elected Trustees of the El Paso, Ysleta, and Soccoro Independent School Districts.
The indictment further alleges that ACCESS’ corrupt activity was assisted, at the Ysleta Independent School District by conspirators Luther Jones, Gilbert Sanchez and David Escobar, who negotiated with ACCESS to influence YISD Trustees to vote for contacts with ACCESS and with a local law firm. Once the contracts were in place, Jones and Escobar allegedly received a portion of a fifteen percent kickback of the total proceeds YISD paid the law firm for legal services. In July of 2009, Robert Jones pleaded guilty to criminal conduct arising out of the same transactions as this indictment.
"The indictment returned by the grand jury demonstrates that schemes to corrupt our elected officials for private gain will not be tolerated. The charges allege a deliberate and long term effort to bribe elected officials in order to buy their votes to award contracts to ACCESS resulting in private financial benefits to the defendants. The people of El Paso are entitled to the honest services of their public officers, motivated only by the best interests of the citizens they are supposed to serve, not by the officers’ personal profit," stated United States Attorney John E. Murphy.
Each of the charges contained in the indictment call for up to 20 years in federal prison and a maximum $250,000 fine upon conviction.
"This investigation exemplifies the FBI’s commitment to investigating and seeking prosecution of individuals who devise schemes and facilitate others in defrauding governmental entities, as well as preserve the intangible right of citizens to the honest services of their elected and appointed public officials," stated FBI Special Agent in Charge David Cuthbertson. "It also sends a message that the citizens of El Paso have the right to benefit from fair and open competition between vendors, who seek to provide governmental entities with millions of dollars in goods and services, which are funded through taxpayer dollars."
This is the seventh indictment stemming from a large scale FBI investigation which began in 2004. To date, 13 individuals have pleaded guilty to criminal conduct stemming from the investigation. The seven indictments include a total of 17 charged defendants. Assistant United States Attorneys Debra Kanof, Antonio Franco, and Laura Franco Gregory, are prosecuting this case on behalf of the government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.