Some residents said they expect more CUC employees to be held accountable for the mess they are suffering as Guerrero talks to authorities.
Guerrero pleaded guilty to one count of conspiracy to defraud the federal government which carries a maximum prison term of five years and a fine of up to $250,000.
According to Guerrero’s plea agreement filed in the U.S. District Court for the Northern Marianas, he is expected to disclose all information about CUC to the FBI and any other designated law enforcement agency as well as testify before the grand jury what he knows during any trial and other court proceedings.
“If the defendant fully complies with the understanding specified in this agreement, he will not be further prosecuted criminally by this office for any crimes, except for criminal tax violations, related to his participation in the scheme which began in or about Feb. 1998 and continued up to and including Jan. 2008, in the Commonwealth of the Northern Mariana Islands,” the plea agreement stated.
In exchange for Guerrero’s cooperation, the federal government recommends a lighter sentence for his offense — between 21 and 27 months jail time or better conditions.
“Based upon the calculations set forth above and provided the defendant’s criminal history is category 1, the stipulated sentencing guidelines range is 21 to 27 months. In addition, after determining the defendant’s ability to pay, the court may impose a fine…. The applicable fine range is $5,000 to $50,000,” the plea agreement further reads.
Based on court papers, CUC gave the Santoses more than $500,000 worth of business between 1998 and 2000 and again in 2007.
However, much of the chemical purchased from them were not used by CUC.
“A total of five transactions took place over the ensuing two years, all of which were less than arm’s length, circumvented procurement regulations and ignored explicit conflict-of-interest statutes. The transactions provided a grossly-inflated profit to ISLAS and little if any benefit to CUC,” said First Assistant U.S. Attorney Jeffery J. Strand in a statement.
He added: “Most of the 8,000-plus gallons of Rydlyme acquired between 1998 and 2000 were never used by CUC and over 1,400 gallons remains in storage on the island of Rota.”
CUC also entered numerous consultancy contracts with several other vendors while Guerrero was in office. It was not immediately known which ones used federal monies.
During a press conference on Monday afternoon, Strand said they are aware that Guerrero will be subjected to a lot of pressure while the probe at CUC continues.
“Obviously, in a small community such as the commonwealth, Mr. Guerrero will be subjected to pressure,” Strand said, but added that it won’t deter them from unearthing more irregularities at CUC for the public’s benefit.
Guerrero, along with Lt. Gov. Timothy P. Villagomez, his sister and her husband, Commerce Secretary James Santos, were indicted on Monday.
All three pleaded not guilty and will face a jury trial set for Oct. 6 at 9 a.m.
News about their scheme shocked residents, particularly in the local community who regard the Villagomezes as a prominent family.
“I was really surprised,” said a local who asked not to be identified.
Another said the incident should remind everyone that “nobody is above the law.”
A government employee who also declined to be named said: “If they can rip off federal funds, how much more the local funds. We’re not supposed to be in this power crisis if they managed well CUC.”
Some lawmakers declined to comment.
