Friday, February 28, 2020

Puerto Rico power company denies it tolerates corruption

By on March 13, 2018

SAN JUAN – Puerto Rico Electric Power Authority (Prepa) Interim Director Justo González rejected a U.S. House Natural Resources Committee letter that is seeking answers from the public utility about reports of corruption, including that some officials took bribes to restore power to exotic dance clubs ahead of schedule.

González said Prepa does not tolerate any acts of corruption and was not aware of any allegations until they were reported by local media. Complaints against the utility related to those claims have yet to be filed.

While no complaints have been received, González said, he urged citizens to file them. “And we would proceed to investigate them and apply all of the legal processes to deal with these cases with firmness,” he said.

Prepa sources believe the letter is part of bondholder lobbying to put pressure on the utility and the government, which is seeking a disaster loan from the U.S. Treasury Department to complete restoration efforts. The federal agency has said it will provide less than the $4 billion the commonwealth government is requesting because the local government has not been able to prove it needs the full amount.

A source also said the letter is intended to taint Prepa to help justify its privatization as some lobby on behalf of parties that want to take hold of the power monopoly.

The letter was signed by the committee Chairman Rob Bishop (R-UT); Bruce Westerman (R-AR), chairman of the Subcommittee on Oversight and Investigations, and Doug LaMalfa (R-CA), chairman of the Subcommittee on Indian, Insular and Alaska Native Affairs.

US House committee reviewing corruption allegations against Puerto Rico power utility

“The latest allegations of corruption and mismanagement raise serious questions regarding Prepa’s internal controls and ability to competently manage power restoration in Puerto Rico. Billions of taxpayer dollars are pledged to help Puerto Rico, but a lack of faith in Puerto Rico’s institutions remains a major barrier to recovery,” the letter reads.

Prepa has yet to restore electric service to the entire island since Hurricane Maria made landfall in late September, which took down power lines, resulting in the collapse of the utility’s already decrepit infrastructure.

The letter said that as part of the committee’s oversight of Puerto Rico’s recovery, it was reviewing “multiple allegations of corruption and mismanagement” of the electrical restoration efforts.

“Much of the reported corruption concerns PREPA officials accepting or demanding bribes to restore power to residences and businesses,” read the letter addressed to González.

Prepa officials allegedly were paid $5,000 and provided free entry tickets worth $1,000 apiece to restore power to strip clubs ahead of schedule.

Prepa separated three workers in Ponce from work and salary for seeking bribes. “The workers are waiting for the completion of the administrative process,” González said.

The letter also cites reports that officials allegedly restored power to their own homes before restoring power to the Río Piedras Medical Center and the Luis Muñoz Marín International Airport.

It accuses the public power company of mismanaging a warehouse where materials were stored that should have been available to help restore power on the island, exacerbating an equipment shortage and contributing to idled work crews and delayed repairs. The warehouse did not appear in computerized inventory lists.

Prepa gave contradictory explanations about the materials. It first said the materials were outdated surplus parts and afterward that they were for infrastructure projects.

“PREPA’s explanations for Warehouse 5 and its inventory have been contradictory and, frankly, inadequate,” the Bishop’s letter reads.

He also requests Prepa preserve all records, documents, data and communications regarding all open investigations into allegations of corruption. Information regarding the parts warehouse is also sought. Prepa is given a March 26, 5 p.m, deadline to submit the documentation to the committee.



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