Most of Puerto Rico’s bond debt had fraudulent credit ratings

by Caribbean News Now contributor

SAN JUAN, Puerto Rico — A special commission looking into allegations of fraud by the financially troubled Puerto Rico Electric Power Authority (PREPA) has turned over its findings to US federal authorities for further investigation, the majority leader of the island’s Senate said on Monday, the Associated Press reported.

Officials with the US attorney’s office and the FBI spent two days last week picking up material gathered by the special Senate commission in its investigation of the electric utility, Senator Anibal Jose Torres said.

Earlier, the commission had submitted its findings to the island’s Justice Department.

The special Senate investigative commission has been looking into allegations that the utility overcharged customers by hundreds of millions of dollars while amassing billions in debt in recent years. Utility officials appearing before the commission denied wrongdoing.

The commission, which has entered the final evidence-gathering stage of its investigation, has found “sufficient information to refer to other branches of local and federal government,” Torres said in a statement.

On June 24, 2015, the Small and Medium Businesses, Commerce, Industry and Telecommunications Commission of the Puerto Rico House of Representatives, issued a 23-page legislative report outlining how government officials in Puerto Rico conspired with Wall Street firms to commit $11 billion dollars in financial fraud.

According to the report, PREPA paid previous bondholders with capital received from new investors, which is the classic hallmark of a Ponzi scheme.

“Noteworthy is the fact that the aforementioned took place in the face of the credit houses, whom, knowing this, and therefore PRPA’s technical insolvency, allowed this public corporation, and thus the people of Puerto Rico, to continue running into debt,” the report said.

The Commission recommended last year that the report be forwarded to the US Justice Department and the Securities Exchange Commission (SEC) for corresponding action, however, Monday’s announcement is the first indication that the FBI and the US attorney’s office have taken an interest in the allegations.

Last month, a US District Judge overseeing a class-action lawsuit against PREPA and the world’s largest fuel oil suppliers for perpetuating an extensive fuel oil fraud has upheld claims that the defendants violated the Racketeer Influenced and Corrupt Organizations Act (RICO) and denied motions to dismiss the suit, allowing RICO claims to continue against PREPA, Shell Oil, Petrobras, Alchem and various other laboratories and fuel oil suppliers.

In the original RICO complaint, filed Feb. 24, 2015, in the US District Court for the District of Puerto Rico, Puerto Rico residents and businesses accused PREPA and 20 defendants of perpetuating an extensive fuel oil fraud, resulting in users of electricity in Puerto Rico being overcharged by more than $1 billion dollars for electricity since 2002.

The suit states the defendants received kickbacks and payments for colluding to raise fuel oil prices that were directly passed to users of electricity, by agreeing to use non-compliant fuel oil and falsifying lab tests.
This is, however, a civil claim and questions have been raised as to the apparent failure of the local FBI office and the US attorney in Puerto Rico to pursue any investigation into these allegations.

Group urges removal of “alien” provision from appropriations legislation

On Monday, May 16,  Congressman Joaquín Castro (TX-20), Second Vice Chair of the Congressional Hispanic Caucus (CHC), led a letter to the House Appropriations Committee, urging them to strike a provision from the FY2017 Legislative Branch Appropriations bill that would require the Library of Congress to use the terms “aliens” and “illegal aliens” in its subject headings.

In March, the Library of Congress decided to replace the term “aliens” in its subject headings with “noncitizens,” and to replace the term “illegal alien” with “non-citizens” and “unauthorized immigration.” The Tri-Caucus – comprised of the Congressional Hispanic Caucus (CHC), the Congressional Asian Pacific American Caucus (CAPAC), and the Congressional Black Caucus (CBC) – also signed the letter.

by the El Reportero’s wire services

Hundreds of mothers from various Mexican states demonstrated today, on mother’s day, for fifth year in a row across one of the main streets of Mexico city to ask for justice.

Participants in the “5th demonstration of national dignity, mothers seeking their sons, daughters, truth and justice”, started at the Monumento a la Madre to reach the obelisk to angel de la Independencia, one of the sites of regular meetings for demonstrations and social demands.

This year, the demonstrators ask for the inclusion of the victims’ families to draft the general law against the forced disappearance.

Gregoria Ortiz from Pachuca, state of Hidalgo, told Prensa Latina news agency “as mothers we don’t have anything to celebrate today and we gather here every May 10”.

Ortiz does not know the whereabouts of her son Gustavo Alberto de la Cruz, 12, who was at that time in his first year of high school and was last seen on march 21, 2007, on his way to school.

“We demand justice and also that institutions in charge, the work of which is almost non-existing, do something to find our missing people. I have been four years searching for my daughter”, said Rocío Uribe, from Mexico state, who is a member of the “Red de Madres Buscando a sus Hijos” (network of mothers searching for their children).

According to estimates published here, the whereabouts of more than 26,000 mexicans remain unknown.

Salvadoran government reiterates refusal to dialogue with gangs

The government of El Salvador reaffirmed today its strong stance regarding the conduction of dialogues, negotiations, agreements or arrangements that would lead to strengthen the organization of gangs or their activities.

The Salvadoran presidential spokesman Eugenio Chicas said at a press conference that this administration keeps fighting against insecurity.

He highlighted that the administration of Salvador Sánchez Cerén has established participation mechanisms in order to formulate policies of the National Council on Citizen Security and Coexistence.

He also said that in this context are included the extraordinary measures approved and implemented on April 1 in order to reduce crime.

The official urged for national unity to support the effort of police officers and soldiers, who risk their lives in the fight against criminal groups to protect the population.

He said that any factor that distracts from the course and clouds the trust can be an advantage for criminals.

Countdown for Chapo Guzmán’s extradition to U.S. begins

Mexican drug lord ‘’El Chapo’’ Guzmán starts today a countdown before a judge approves his extradition to the United States.

The head of the Sinaloa cartel is being held at a special cell in a prison in Ciudad Juarez, in the northern state of Chihuahua, only a few dozen kilometers away from the United States.

A security detail including Mexican members and others from the United States Federal Bureau of Investigations (FBI), guarded Guzman’s transfer from a high security prison in the capital. Hours before the operation, a Mexican federal judge ruled in favor of the extradition to the United States, therefore the Mexican Foreign Ministry has 30 days to materialize his delivery to authorities in the U.S., where El Chapo is facing charges in several courts.

El Chapo’s lawyer José Refugio Rodríguez had said he was convinced by Mexican authorities would favor an extradition of his client to the United States.
The extradition resource in drug trafficking cases is not new in Mexico; however the government had previously said it would prefer to judge Guzman in the country.

EL Chapo has broken out from Mexican prisons twice in the past.