Former BLM Official Pleads Guilty to Public Corruption Charges Sophisticated Contract Manipulation Scheme Defrauds BLM of Over $400,000
|U.S. Attorney’s Office April 16, 2010|
MEDFORD, OR—Luis Ramirez, 57, of Medford, Oregon, pled guilty today in U.S. District Court to charges of wire fraud, personal financial conflict of interest, and making a false tax return statement. In 2009, three indictments were returned by a federal grand jury charging Ramirez with five counts of wire fraud, along with separate counts of personal financial conflict of interest and making a false tax return statement. Ramirez pled guilty to all seven charges.
Ramirez was employed as a Contracting Officer’s Representative for the Bureau of Land Management (BLM) in the Medford District Office. He was responsible for administering BLM contracts including approving work to be done on the contracts and submitting invoices to BLM Contracting Officers in Portland for their approval and payment to private contractors. Ramirez, employed by BLM for 31 years, abruptly retired in July 2007 when his schemes to defraud BLM began to unravel. The FBI initiated an investigation upon receiving information from an anonymous source that Ramirez was allegedly receiving personal payments from private BLM contractors involving his official duties.
In pleading guilty, Ramirez admitted that from May 2004 until July 2007, he intentionally devised and carried out various schemes to defraud BLM of at least $481,600. The schemes included Ramirez arranging for private contractors, unbeknownst to BLM, to subcontract work to his son, Evan Ramirez, age 30, on BLM contracts that were being administered by him. In other instances, work he approved for the contractors to complete was never performed, while in other instances he increased the cost of work that was merely redundant and duplicitous of other approved work under the contracts.
As part of these schemes, Ramirez would then submit false certificates to the BLM Contracting Officers in Portland certifying that specific work he had approved under the contracts was completed by the contractor, and seek the Contracting Officer’s authorization for payment to the contractor for the claimed work, all the while knowing that the work was unnecessary, unwarranted, not actually performed by the contractor or was never performed at all.
Upon securing the Contracting Officers approval and authorization for payment, BLM funds were then sent by interstate wire to the contractor’s bank account. Ramirez arranged through various deceptive means to have the private contractors issue checks to Ramirez’s son, Evan, either directly or through third parties, and sometimes directly to third parties who then transferred the funds to him, and the contractors were reimbursed with the BLM payments under the contracts. Large portions of the checks issued to Ramirez’s son by the contractors were ultimately transferred into Ramirez’s personal bank account.
In carrying out his scheme to defraud, Ramirez also admitted that he violated federal conflict of interest laws in taking action as a government official on the BLM contracts he was administering when he had a personal financial interest in them, all without the knowledge of BLM. Further, he acknowledged that he submitted a false personal income tax return to the Internal Revenue Service in 2006, declaring under penalty of perjury that the tax return was complete and accurate when he knew he was not reporting $166,000 of income to the IRS.
Evan Ramirez, of Boston, Massachusetts, also pled guilty today in U.S. District Court to a government charge of making a false tax return statement in 2007. He admitted that when he submitted his 2006 personal income tax return to the Internal Revenue Service it was false and, while declaring under penalty of perjury that the tax return was complete and accurate, he knew he was not reporting $18,055 of income to the IRS, the source of which was from criminal activity.
“We will not tolerate any form of public corruption,” said United States Attorney Dwight C. Holton. “It is important for the public to know that government officials perform their official duties free from corruption, self-enrichment and conflict of interest.”
Both defendants are scheduled for sentencing before U.S. District Judge Owen Panner on June 26, 2010 at 10:00 a.m. Wire fraud carries a maximum penalty of 20 years' imprisonment and a $250,000 fine. Personal financial conflict of interest carries a penalty of five years' imprisonment and a $250,000 fine, and making and subscribing a false tax return statement carries a penalty of three years' imprisonment and a $100,000 fine, together with the costs of prosecution.
This was a joint investigation by the Medford offices of the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation. The case is being prosecuted by Assistant U.S. Attorney Byron Chatfield.