Two Contractors Arrested for Bribery

SAN JUAN, PR—Today, Juan Antonio San Miguel and Juan Carlos Mercado were arrested by Federal Bureau of Investigation (FBI) agents for bribery concerning programs receiving federal funds, announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. These charges relate to yesterday’s arrest of Sol Luis Fontanes-Olivo, mayor of the municipality of Barceloneta, Puerto Rico.

The complaint charging San Miguel and Mercado with one count of bribery concerning programs receiving federal funds was authorized last night by U.S. District Court Magistrate Judge Bruce McGiverin.

According to the charging document, Juan Antonio San Miguel is a well-known businessman. In the summer of 2011, San Miguel and Fontanes-Olivo agreed that the Municipality of Barceloneta would buy a lot owned by San Miguel. The purchase price for the lot was set at $100,000. Fontanes-Olivo stated he would buy the lot, but wanted San Miguel to pay him a $40,000 kickback. From July 2011 to September 1, 2011, co-conspirator 1 (CC1) picked up a total of $22,000 to $25,000 in kickback payments made by San Miguel. The kickback money was delivered to Fontanes-Olivo by CC1. On September 20, 2011, during a recorded meeting, San Miguel provided CC1 with $5,000 related to the $40,000 kickback originally requested by Fontanes-Olivo in connection with the $100,000 lot.

Juan Carlos Mercado is an environmental engineer and owner of ITG Ingenieros, a management group that specializes in the areas of civil, sanitary and environmental engineering. According to the affidavit supporting the complaint, Mercado had paid bribes approximately six times. CC1 was paid four bribe/kickback payments from Mercado totaling $14,000. The affidavit also indicates that Mercado has directly paid Luis Fontanez-Olivo, bribes in order to be awarded contracts with the Municipality of Barceloneta.

“With these two arrests we have closed the circle of corruption headed by the mayor and promoted by two contractors who were willing to pay kickbacks in exchange for doing business with the municipality of Barceloneta,” said U.S. Attorney Rosa Emilia Rodríguez-Vélez. “We will continue to prosecute both public officials and contractors who abuse their positions of trust and use their financial power for personal gain. This investigation continues.”

This case was investigated by the FBI and is being prosecuted by AUSA Charles Walsh.

If found guilty, the defendant could face up to 10 years in prison and a $250,000 fine. Criminal complaints contain only charges and are not evidence of guilt. Defendants are presumed to be innocent unless and until proven guilty.