Sunday, May 22, 2022

Day 13 og gov´t corruption trial: Preferential treatment for Prasa contractor

By on September 12, 2016

SAN JUAN – Lourdes Alsina Miranda, finance manager at the Puerto Rico Aqueduct and Sewer Authority (Prasa), said today that she found out that the utility’s former treasurer and later vice president, Ivonne Falcón Nieves, issued payments before their due date to favor a contractor.

“In 2011 I detected that they were making payments before they became due. In 2012 invoices were not due and they issued checks ahead of time to IA Mech (owned by Ramón Crespo)… That goes against a sound administration because it puts other suppliers at a disadvantage and affects Prasa’s cash flow,” said Alsina Miranda.

The witness explained that the ordinary payment process to suppliers at Prasa in 2011 was 30 days after the invoice due date. The term was later changed to 45 days and now the utility’s contractors get paid 60 days after their invoice is due.

However and despite this payment term, between 2011 and 2012 Falcón Nieves—as Prasa treasurer—approved that Ramón Crespo’s company IA Mech would be paid before the invoice due date, according to the witness’ testimony.

Federal prosecutor Timothy Henwood filed several documents as part of Alsina Miranda’s testimony, showing on March 8, 2012 Falcón authorized payment of an IA Mech invoice 20 days before payment was due, then in June authorized another payment of $73,246 one month before its due date. On October 9, 2012 she once again authorized another invoice in advance for this company in the amount of $140,508 and in December there was another advance payment for $239,970.

Last Friday Ramón Crespo, owner of IA Mech, said that by the spring of 2012 he reencountered Marielis Falcón—co-defendant in the criminal case and sister of Ivonne Falcón—and she offered to help expedite payment of his invoices at Prasa if the contractor paid her 10% of each check issued by the utility.

According to Crespo’s testimony, Marielis Falcón received nearly $100,000 for making Prasa pay his invoices faster during her sister Yvonne’s tenure as treasurer of the utility.

Today the federal prosecutor questioned the Prasa regional finance manager regarding payments authorized by Ivonne Falcón to contractor Ramon Crespo’s company and the official reiterated that he was paid in advance before his invoices became due.

When did it happen again than advance payments were issued to IA Mech ?, Henwood asked Alsina Miranda. “In 2012 but (advance payments) took place in 2011, 2012 and 2013,” she said.

In a Prasa in internal memo dated April 22, 2013 and sent by Ivonne Falcón—who at the time was the utility’s vice president—she inquires about pending IA Mech invoices which the supplier “claims that he is owed” and asks to verify the matter and report the results to her.

Along with this document Ivonne Falcón attached the list of invoices and Ramón Crespo lines pending payment, which amounted to $889,816.20.

Last Friday Crespo said he met with Anaudi Hernández in 2013 and spoke to Popular Democratic Party’s (PDP) former electoral commissioner Eder Ortiz requesting help in expediting the payment of a $1 million invoice to Prasa. Both Crespo as Anaudi assured during the trial that the contractor would pay them $100,000 in exchange for Anaudi and Eder getting him the check for $1 million.

Today the Prasa eastern region’s finance manager testified that on April 22, 2013 she was instructed by Ivonne Falcón to check Crespo’s outstanding invoices and after following up for a month with several utility employees the money to pay the contractor appeared in May.

“Right now we are allocating $834,043 to finance IA Mech costs”, reads an email dated May 16, 2013 that was sent to the witness and other Prasa finance personnel.

What happened to pending payments for other of contractors?, asked the federal prosecutor. “I didn’t get the funds allocated,” said Alsina Miranda.

On another email dated May 20, 2013 and presented to the jury the witness tells a colleague that “Ivonne wants us to issue payment tomorrow” to IA Mech, Ramón Crespo’s company.

On May 22 Prasa issued Crespo a payment of $131,562 and according to evidence presented in the courtroom, that same day Ivonne Falcón sent an email asking for help in getting out the $800,000 check for IA Mech.

Seven days later, on May 29, 2013, Ivonne Falcón sent another email—addressed to Teodoro Cruz, then head of finance—thanking him for the new payment to contractor Crespo. “Thank Teodoro. We are missing like $350,000. The total was $ 800,000. Suzzette, see if you can include it for this week,” reads the email from Prasa’s former vice president.

The following day Prasa issued a new check to Crespo’s company in the amount of $364,661 and on May 30, 2013 the utility contractor wrote a check for $10,000to Ivonne’s sister Marielis Falcón.

During cross-examination former Prasa vice president’s defense attorney, Godwin Aldarondo, questioned the witness if she knew why IA Mech’s debt accumulated until it reached one million dollars and Alsina Miranda replied that it was due to “the lack of Prasa purchases orders to the supplier and secondly because the utility had no budget.”

So it was not an advance payment like you said?, asked Ivonne Falcón’s defense. “What I said before is that invoices were paid before the due date that appears on the system. It is unusual to pay a supplier before 40 days. Yes, we pay past the due date, but paying before is not the norm,” said Alsina Miranda.

The federal prosecutor then called Ashley Hernández and Eduardo Hernández, daughter and father respectively, and both testified that in January 2013 they received two checks from Marielis Falcón to pay for construction work he was doing at Marielis’ house in Bayamon.

Crespo González’s company IA Mech issued both checks as payments to Marielis for expediting payment of his invoices at Prasa. In turn, Marielis Falcón used the money to pay the contractor remodeling her home.

On January 13, 2013 Ashley Hernández went to the bank with the $7,000 check issued in her name from IA Mech and got it cashed. After cashing it Marielis Falcón paid Hernández’ father’s employees who were remodeling her home and covered some expenses for materials, declared the young woman.

“They gave it to her in bundles of money. The teller put it on the counter and Marielis took it,” said Ashley Hernández. Her father, Eduardo, said the remodeling job he did for Marielis Falcón cost between $45,000 and $50,000. “She mostly paid cash and sometimes with a check,” he said.

The federal prosecutor later called to declare the banker of the Prasa contractor who paid Marielis, Anaudi and Eder to expedite payment of is invoices at the utility and he said that Ramón Crespo often made cash withdrawals from his commercial account at Doral Bank. “He would withdraw a minimum of $10,000 up to a maximum of $50,000 in cash. I told him that handling cash was inappropriate and told him that he should use checks for cash payments,” said banker Francisco Christian Betancourt.

Meanwhile, in order to demonstrate the federal jurisdiction in the public corruption case, the federal prosecutor also called Efraín Acosta, Prasa’s current director of finance, and Diana Vázquez Morales, treasury department supervisor at the Puerto Rico Department of Treasury (Hacienda in Spanish) to testify. Both officials testified that both Prasa and Hacienda receive more than $10,000 in federal funds.

The trial resumes tomorrow at 9:00 a.m. in the Federal Court against his co-defendants Sally López, former director of te Workforce Development Administration (ADL by its Spanish acronym); Ivonne Falcón, former Prasa vice president; her sister Marielis Falcón and Glenn Rivera Pizarro, former aide of House administrator Xavier González.

The federal government has subpoenaed 26 witnesses for the prosecution so far.

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