By Cherrie Anne E. Villahermosa
Variety News Staff

A SUPERVISOR at the CNMI Treasury Office, a former employee of the Department of Finance and a businessman were arrested on Friday for engaging in a scheme to defraud the CNMI government by submitting false information to collect payments totaling over $35,000.
Francisco C. Calvo, 45, and Maria B. Masga, 44, were arrested for theft and misconduct in public office, while Edward B. Ada, 42, was arrested for violating the Commonwealth Criminal Code.
The three were brought to Superior Court yesterday morning for a bail hearing.
The government was represented by Assistant Attorney General Mike Nisperos while the defendants were represented by attorneys Joaquin Torres and Richard W. Pierce.
Each of the defendants posted an unsecured bond of $25,000.
Presiding Judge Robert C. Naraja ordered their release from the custody of the Department of Corrections.
They will return to court on April 16 at 9 a.m. for arraignment.
According to the affidavit of Paul Ogumoro, an investigator at the Attorney General’s Office, on June 12, 2006, the Office of the Public Auditor received a complaint regarding the theft of over $30,000 in government funds by the owner of Pacific Lawn Care Services — Edward Borja Ada.
The joint investigation conducted by OPA and the AGO found that on June 23, 2006, an employee of the Office of Management and Budget contacted the acting director of finance and accounting to verify the validity of certain activities on a particular account.
The employee found an unusually large amount charged to the prior year adjustment account for payment to Pacific Lawn Care Services.
The affidavit stated that Masga admitted to acting Director of Finance and Accounting Bernie Palacios that she and Ada were making fake invoices using Pacific Lawn Care Services.
Masga said they were getting paid by the government and she and Ada were splitting the payments between them.
The affidavit stated that Masga received approximately $10,000 from these transactions.
According to the affidavit, Masga, Ada and Calvo, a supervisor at the CNMI Treasury Office, introduced false information into the computer system of the Department of Finance to collect payments and split the proceeds among them.
As a result of the scheme, some $30,825 was fraudulently taken from numerous local accounts and a federal account, the affidavit stated.
It added that when interviewed on Aug 30, 2006 at OPA, Masga admitted that she and Ada planned to commit theft by inputting payment information and dates using bogus invoices into the finance department’s computer system in order to receive payments.
Every time Masga put the false data into the system, Ada would receive payments at the treasury office, cash the checks and give Masga her share.
Every transaction was done discretely to avoid suspicion and detection by finance and accounting personnel, the affidavit stated.
At the time, Masga was supervisor of the accounts payable section at the Department of Finance.
Masga admitted receiving $7,800 from Ada as her share for orchestrating the release of some 18 fraudulent payments to Pacific Lawn Care Services.
These payments totaled approximately $35,825.
Masga would receive from Ada $300 to $500 per transaction which began in March 2006 and ended in June 2006 when her supervisor discovered the scheme.
Masga found several accounts in the system and charged the accounts for payments to Pacific Lawn Care Services.
The accounts used were “the General Fund Balance Sheet, Alien Security Bond Deposit, Calendar Year 2004 NMTIT Individual Rebate Tax, Calendar Year 2004 NMTIT Corporate Rebate Tax, General Fund Balance Sheet for Rd. Cutting & Trenching Dep., Calendar Year 2003 NMTIT Rebate Individual, Rebate Tax, Prior Year Adjustment, Misc. Adjustment, Calendar Year 2002 NMTIT Individual Rebate Tax, Calendar Year 1998 NMTIT Individual Rebate Tax and Calendar Year 1997 Individual Rebate Tax.”
Masga tried to cover her tracks by changing the figures in the accounts used in their scheme but the system had already recorded these transactions, the affidavit stated.
In a separate interview with Ada, he admitted that he was the sole owner of Pacific Lawn Care Services whose business license expired in 2004.
Ada said it was Masga who came up with the plan to use his business name to manipulate the computer system at the Department of Finance.
Calvo said one of his duties was to issue payments to vendors, as well as approve, sign, and issue manual checks.
Calvo said he only found out that Ada was the owner of Pacific Lawn Care Services when Ada started bringing payment vouchers and receiving payments for the company.
Calvo estimates receiving between $3,000 to $4,000 from Ada between April and June 2006.
He said he spent most of the money on poker.