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FOR IMMEDIATE RELEASE
Date: November 20, 2007

NINE INDICTED FOR PELL GRANT PROGRAM FRAUD

SAN JUAN, P.R. - United States Attorney Rosa Emilia Rodriguez-Vélez announced today the indictment of nine defendants charged with the commission of offenses against the United States Department of Education, specifically conspiracy to commit student financial aid fraud, conspiracy to submit false statements, illegal conversion of federal funds and money laundering. The indictment also contains a forfeiture count based on the money laundering offense. Five of the defendants were arrested earlier today.

The defendants accused of this conspiracy are: Mary Lao Institute; Corporación de Servicios Educativos de Puerto Rico; Irma Valentín-Serrano, mother of defendants Carlos Abreu-Valentín and Ángel Abreu-Valentín; Janet Miranda-Caban; Aileen Arana-Serrano; Nowling Martínez-Contes and Lissa Ramos-García.
The object of the conspiracy was to falsify and cause to be falsified students' records to avoid the payment of refunds due for funds provided by the U.S. Department of Education under Subchapter IV of Title 20, United States Code; and part C of Subchapter I of Chapter 34 of Title 42, United States Code, that is, Pell Grant Funds.

It was part of the manner and means of the Conspiracy that co-defendants Irma Valentín-Serrano, Carlos and Ángel Abreu-Valentín, would use Pell Grant funds to pay for personal loans, real estate, and businesses, all of which were unrelated to the operation of Instituto Irma Valentín (IIV), as well as to disburse monies to relatives who were not employed by nor did they render services to IIV, while owing refunds to the U.S. Department of Education.

"We reiterate ourselves, that our commitment with the community is to stop criminals at all levels," said Rosa Emilia Rodriguez-Vélez, United States Attorney for the District of Puerto Rico. "Five days ago we dismantled a drug trafficking organization, and today we disarticulated a complicated fraud scheme pertaining to federal funds destined for students who deserve the opportunity to obtain a better education and develop their employment potential. These acts will be prosecuted to the full extent of the law."

Defendants Mary Lao Institute, Corporación de Servicios de Puerto Rico, Irma Valentín-Serrano, Carlos Abreu-Valentín and Angel Abreu-Valentín, shall forfeit to the United States all conveyances used in the commission of the violation, all property, real and personal, that constitutes or is derived from or is traceable to proceeds obtained directly or indirectly from the commission of the offense, and all property, real or personal, that was used to facilitate, or was intended to be used to facilitate the commission of the offense including, but not limited to the following: $102,283.00 or any other property of said defendants up to the value of the forfeitable money judgment, representing the amount of proceeds obtained as a result of the offense.

"Today's arrests come on the heels of an indictment that alleges that the defendants used their positions of trust to defraud federal education programs at the expense of students," said John P. Higgins, Jr., Inspector General of the U.S. Department of Education. "We will continue to work with our colleagues in law enforcement to protect federal education dollars from this kind of calculated plunder."

This investigation was conducted by the Federal Bureau of Investigation (FBI) in Puerto Rico, directed by Luis Fraticelli, Special Agent in Charge, and the Department of Education, Office of Inspector General; and will be prosecuted by Assistant U.S. Attorney Myriam Fernández.

If convicted of the alleged offenses, the defendants face a maximum of five years of imprisonment, a fine of $250,000.00, or both on Counts One and Two; a fine up to $250,000.00 and no more than ten years of imprisonment or both on Count Three; and a fine of not more than $500,000 or twice the value of the property involved in the transaction, whichever is greater, or imprisonment for not more than twenty years or both on Count Four. The defendants are presumed innocent and are entitled to a fair trial and the government has the burden of proving guilt beyond a reasonable doubt.