FOLLOWING the unsealing of a federal indictment on Friday, the Federal Bureau of Investigation executed an arrest warrant against former CNMI Public School System employee Giselle Butalid and her mother, Clarissa Adlawan, for multiple charges including conspiracy, theft of federal funds, money laundering, and structuring financial transactions.
The two women are scheduled for an initial appearance hearing before District Court for the NMI Chief Judge Ramona V. Manglona today at 3:30 p.m.
The indictment outlines a complex scheme that allegedly defrauded PSS of tens of thousands of dollars in federal grant money.
In a statement on Sunday, PSS said it “does not provide comments on matters that are before the courts or judicial authorities. We emphasize, however, that PSS has strict policies in place, consistent with applicable regulations, to safeguard against any misuse of both local and federal funds.”
According to the indictment, Butalid, a U.S. citizen and former employee of PSS’s Office of Curriculum and Instruction or OCI, and Adlawan, her mother and a Philippine national residing in the CNMI, used their company, One Legacy LLC, to submit fraudulent invoices and quotations for educational materials. The company, registered in January 2021, was allegedly used to funnel federal funds through falsified procurement documents.
Butalid and Adlawan were charged with one count of conspiracy to commit theft, five counts of theft of federal funds, one count of money laundering conspiracy, one count of illegal monetary transactions, and four counts of structuring financial transactions.
The indictment provided details of how Butalid allegedly exploited her position at PSS to forge documents, create fake vendor quotations, and authorize sole-source procurements for One Legacy. The company then received payments for educational materials that were either never delivered or falsely represented.
Butalid, in her PSS position, had access “to critical information and data, such as the electronic signatures of OCI managers, vendor invoices, and funding information of the OCI program, which in turn, enabled her to access and exploit PSS’s procurement process,” the indictment stated.
In addition, the indictment stated that Butalid used this access to forge and falsify documents, resulting in PSS purchase orders for educational material from legitimate third-party companies through One Legacy, while hiding from PSS that she and Adlawan owned the company.
The indictment further stated that the defendants laundered the proceeds through frequent cash withdrawals, ATM transactions in the Philippines, and luxury purchases, including stays at high-end hotels and shopping sprees at Prada and Louis Vuitton.
Specifically, the indictment cited the following purchases:
– $1,140 spent at a Prada store on Guam on July 25, 2022.
– Approximately $940 at the Shangri-La Hotel in Manila on May 2, 2022.
– $3,200 at a Louis Vuitton store on Guam on May 16, 2022.
The charges also seek forfeiture of assets tied to the alleged crimes and substitute property if the original assets cannot be recovered.
Assistant U.S. Attorney Eric S. O’Malley is prosecuting the case under the direction of the U.S. Attorney for the Districts of Guam and NMI, Shawn N. Anderson.
