SAN JUAN, Puerto Rico (Reuters) - Two former high-ranking Puerto Rico government officials were among six people arrested and charged with conspiracy and other crimes in connection with millions of dollars in federal education and Medicaid funds, U.S. law enforcement officials said on Wednesday.
The six are accused of stealing federal money through various government contracts that were awarded as part of corrupt bidding processes.
The arrests come as the bankrupt U.S. territory is seeking to obtain more federal money that it needs for post-Hurricane Maria reconstruction and for increased Medicaid funding.
Puerto Rico has been in U.S. District Court since 2017 using a form of bankruptcy to restructure about $120 billion of debt and pension obligations.
Julia Keleher, who headed Puerto Rico’s education department until April, and Angela Avila-Marrero, executive director of Health Insurance Administration, who left the job last month, used their positions to “benefit and enrich themselves through fraud and the theft of government funds,” according to the 32-charge indictment relating to $15 million in federal funds.
Keleher was arrested in Washington. Her attorney did not immediately reply to a request for comment. An attorney could not immediately be identified for Avila-Marrero, who was arrested in Puerto Rico.
Jose Soto, deputy director of the U.S. Department of Health and Human Services’ Office of Inspector General overseeing Puerto Rico, said part of the scheme involved an agency that manages Medicaid funds, adding that his office will “make recommendations” to the Centers for Medicaid and Medicare Services.
A U.S. House subcommittee is scheduled on Thursday to take up new legislation that would increase federal Medicaid funding for Puerto Rico by $12 billion over four years.
Jenniffer Gonzalez, Puerto Rico’s nonvoting representative in the U.S. Congress, said in an emailed statement that the indictments pose another challenge to procuring needed funding for the island, which was hit by devastating hurricanes in 2017.
She said, “things like these make the process of obtaining and disbursing funds, and of making decisions on programs, even harder at all levels.”
U.S. Representative Raul Grijalva, a Democrat from Arizona who chairs the House National Resources Committee, which oversees U.S. territories, called on Governor Ricardo Rossello to restore credibility.
“Governor Rossello has little time and much to do to restore public faith in his government, and I urge him to take a housecleaning approach as quickly and thoroughly as possible,” Grijalva said in a statement.
Rossello, who law enforcement officials said was not implicated in the indictment, issued a statement that his administration “will not tolerate corruption” and pledged to cooperate with law enforcement.
Reporting by Luis Valentin Ortiz in San Juan; Additional reporting by Karen Pierog in Chicago; Editing by Matthew Lewis and Rosalba O'Brien