Two FEMA officials who ‘lived luxury lifestyle’ while leading hurricane relief in Puerto Rico charged with fraud and bribery

Official struck deal in midst of Hurricane Maria devastation to get helicopter ride and hotel stay, authorities say

Matt Zapotosky,Steven Mufson
Wednesday 11 September 2019 10:17 BST
Trump throws paper towels out to Puerto Rico hurricane victims

Two Federal Emergency Management Agency (FEMA) officials assigned to help manage restoration efforts in Puerto Rico after Hurricane Maria have been charged with fraud and bribery for allegedly trying to enrich themselves by helping a company that received $1.8 billion in government contracts, the Justice Department announced Tuesday.

One of the officials, whom the Justice Department identified as FEMA's "primary leader" for restoring power on the island, pressured her colleagues and Puerto Rico Electric Power Authority officials to give government work to the company, Cobra Acquisitions, authorities said.

In exchange, authorities said, the company's then-president gave her a helicopter ride, hotel accommodations, first-class airfare, personal security services and use of a credit card. And, when a friend and colleague left FEMA, the executive helped her get a job at Cobra Energy, authorities said.

"These defendants were supposed to come to Puerto Rico to help during the recovery after the devastation suffered from Hurricane Maria," Rosa Emilia Rodríguez-Vélez, the U.S. attorney for Puerto Rico, said in a statement announcing the indictment.

"Instead, they decided to take advantage of the precarious conditions of our electric power grid and engaged in a bribery and honest services wire fraud scheme in order to enrich themselves illegally."

Those charged were Ahsha Tribble, a FEMA deputy regional administrator whom authorities described as the leader in power restoration in Puerto Rico; Jovanda Patterson, a FEMA deputy chief of staff who left her position in July 2018 to work for Cobra Energy; and Donald Ellison, who was president of Cobra Acquisitions until June.

Bill Leone, a lawyer for Ellison, said the indictment "criminalises normal business and personal relationships that are not criminal under the law, no matter how far you stretch it."

"He didn't bribe anyone, and we look forward to getting into court to establish that he didn't bribe anybody," Mr Leone said.

"I think Keith deserves as much or more credit than any person on the planet for getting electricity restored in Puerto Rico, despite all the obstacles created by many layers of government bureaucracy, and I do believe he is the victim of a blame game that is underway in Puerto Rico and Washington."

Bridget Moore, an attorney for Tribble, said, "I look forward to vindicating our client, and bringing to light the details of how this investigation has been handled by the government."

Timothy Belevetz, a lawyer for Patterson, said, "Jovanda has spent nearly all of her career in selfless service to her country, both in uniform and as a civilian, often in areas ravaged by natural disasters. She did not commit the offences she has been charged with, and we are looking forward to challenging the government's allegations at trial."

Puerto Rico is still recovering from Hurricane Maria, the catastrophic Category 4 storm that struck in 2017 and left more than 3 million residents without power.

The wreckage created what is believed to be the longest blackout in US history, contributing to the deaths of thousands who needed access to electricity to run lifesaving equipment such as dialysis machines and breathing devices.

Damaged road in Toa Alta, near Puerto Rico, in destructive path of Hurricane Maria (AFP/Getty)

It took nearly a year to restore power to a majority of the Puerto Rico Electric Power Authority's customers.

"Corruption in the ranks of DHS and FEMA won't be tolerated," said Department of Homeland Security Inspector General Joseph Cuffari.

Officials poured billions of dollars into repairing the power grid, though even now, officials say, it remains fragile. Tribble arrived in Puerto Rico in October to direct recovery efforts related to the island's bankrupt public utility and the hurricane-ravaged power grid.

The restoration project was hampered early on by scandal after the Puerto Rico Electric Power Authority, the island's power company, awarded a contract to a little-known, two-person firm out of Montana called Whitefish Energy to rebuild the grid.

After that contract was withdrawn, Cobra, a subsidiary of Mammoth Energy, became one of three stateside companies to win federal money to replace transmission towers, erect power poles and restring power lines across Puerto Rico.

Nydia Velázquez said the investigation shows that corruption may have been a factor in the slow federal response.

Trump White House spokesperson refers to Puerto Rico as 'that country' on live television twice

"If proven," Velázquez said in a statement, "this misuse of funds suggests that, while our fellow citizens on the Island were dying from a lack of electricity, private companies stateside were plotting how to illicitly profit at taxpayers' expense."

The Department of Homeland Security's inspector general found that when Puerto Rico Electric Power Authority entered into a 12-month contract with Cobra, FEMA was "unsound" in its evaluation of the company's eligibility, and the "reasonableness" of the costs estimated for the work were inaccurate, according to a report released in July.

FEMA's analysis of Cobra's labour rates, equipment costs and fees "were not always logical, complete, and supported," the report said. The firm at one point had about 600 people working on the island.

In a 48-page indictment, federal prosecutors said that Tribble exerted her authority in various ways to ensure Cobra got government work and that local officials accepted the costs Cobra billed.

In one instance, after an explosion left several municipalities without electricity, prosecutors said, Tribble pressed Puerto Rico Electric Power Authority executives to let Cobra fix the problem even though the executives believed that would increase costs.

They billed more than $600,000 for the repairs, according to the indictment.

Meanwhile, Tribble reaped the rewards, prosecutors contend. In January 2018, she enquired with Ellison about hotels in New York, and on February 11 she asked for help finding a place to live there and prioritising her needs about location, safety and furnishings.

Ellison replied three days later saying "Yes ma'am, I got it and have somebody on it already," according to the indictment. Tribble's note came on the day of the explosion.

Mr Leone, Ellison's lawyer, said that a review of Cobra's costs by the Rand Corp. found them to be "reasonable," that multiple officials oversaw all of the work, and that the lucrative contracts were awarded before Ellison met Tribble.

He said Cobra was "the only contractor willing to work on credit," and while federal officials would sometimes press to get their invoices paid, that was not the result of bribes.

"People would get involved sometimes to get the bills paid, but to say that that was somehow a result of him trying to help her find a place in New York one time is ridiculous," Mr Leone said.

Tribble and Ellison communicated on private email and disposable, prepaid cellphones, federal prosecutors said, about work and personal matters. The two were caught on surveillance video gambling together at a Puerto Rico casino, prosecutors said.

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Prosecutors said Ellison lied to the FBI and Department of Homeland Security inspector general about the nature of his relationship with Tribble, which he claimed was purely related to work.

Tribble has been suspended from FEMA but not terminated, according to a spokesman for the U.S. attorney's office in Puerto Rico. In a statement, a FEMA spokesman said Tribble was "in a non-duty, non-pay status."

"While we defer to the Department of Justice and the Department of Homeland Security Inspector General on specific questions regarding the indictment, generally employees in that status may not conduct official business on behalf of the federal government," the spokesman said.

The agency also said it was "fully cooperating with federal investigators."

Peter Mirijanian, spokesman for Mammoth Energy Services, said: "Mammoth is aware of and has been cooperating with the government's investigation into Ms. Tribble and Mr. Ellison and will continue to do so."

Cobra's parent company, Mammoth Energy Services, is an Oklahoma-based oil-field services firm. Forty-nine percent of Mammoth is owned by Wexford Capital, an investment firm in Greenwich, Connecticut.

News of Cobra's work for Puerto Rico Electric Power Authority helped drive up the company's stock. It hit a peak of $40.88 a share on June 22, 2018, but the share price has plunged 90 percent since, wiping out more than $1 billion in market value. Analysts following the company slashed price targets in June, citing the completion of Cobra's work.

In addition to bringing criminal charges, prosecutors moved to seize more than $48 million in several bank accounts under Ellison's name, a 40-foot catamaran, and other vehicles and equipment.

The Washington Post

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