Friday, January 30, 2015

New Mexico Man & Former Tribal Governor Pleads Guilty To Embezzling Nearly $3.6 Million From Agency

From KRWG-TV on 1/28/2015:

A former Governor of Santa Ana Pueblo and a real estate consultant pleaded guilty this morning to federal embezzlement and tax charges arising out of a scheme to embezzle approximately $3,575,000.00 from the Indian Pueblo Federal Development Corporation (IPFDC), an Indian tribal organization formed by the 19 Pueblos of New Mexico for the purpose of developing land that once had been the site of the Albuquerque Indian School.

Bruce Sanchez, 60, a member, resident and former Governor of Santa Ana Pueblo, N.M., entered a guilty plea to embezzlement from an Indian tribal organization and tax evasion charges.  His co-defendant Thomas Keesing, 61, of Pecos, N.M., pled guilty to aiding and abetting embezzlement from an Indian tribal organization and the willful failure to file a tax return.  The guilty pleas were announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge Dawn Mertz of the Phoenix Field Office of IRS Criminal Investigation, and Matthew Elliot, Deputy Assistant Inspector General for Investigations for the Department of the Interior.

Sanchez and Keesing were indicted in Oct. 2012, and charged with a conspiracy offense and ten substantive embezzlement offenses arising out of the scheme to steal funds belonging to the IPFDC.  The 15-count indictment also charged Sanchez with three tax evasion counts alleging an aggregate federal tax loss of $655,276.00, and a misdemeanor count of willful failure to file a tax return.  In Aug. 2013, Keesing was charged by information with three misdemeanor counts of failure to file tax returns and those tax charges were consolidated into the case.  The information charged Keesing with failure to file federal tax returns for calendar years 2006, 2007 and 2008, even though he received gross income in the aggregate amount of $2,771,250.00 during those three years.

According to the indictment, between 2003 and 2009, Sanchez and Keesing conspired to embezzle approximately $3,575,000.00 from the IPFDC.  During that time, Sanchez was the president and chief executive officer of the IPFDC.  Keesing, a commercial real estate developer and the owner of New Mexico Real Estate, Inc. (NMREI), worked as a consultant for IPFDC in 2002 and 2003. 

Sanchez and Keesing engaged in a scheme to unlawfully profit from the development of the Albuquerque Indian School property by having Keesing submit false and fraudulently inflated invoices for payment from NMREI to the IPFDC.  Sanchez approved the invoices even though the payments were vastly in excess of the value of any services provided by Keesing and NMREI.  Keesing then shared the proceeds of the fraudulently obtained IPFDC payments with Sanchez. 

Between 2003 and 2008 and as a result of this illegal scheme, Keesing and NMREI received $3,775,000.00 in payments from the IPFDC, including $3,575,000.00 that was fraudulently obtained.  During that same period, Sanchez and Tsachu, LLC, his solely-owned consulting company, received approximately $1,722,823.04 from Keesing and NMREI.

This morning, Sanchez entered guilty pleas to Counts 3 and 13 of the indictment charging him with embezzlement from an Indian tribal organization and tax evasion, respectively.  Sanchez’s plea agreement details the embezzlement scheme through which Sanchez and Keesing defrauded the IPFDC of $3,575,000.00.  Sanchez brought Keesing onto the IPFDC development team in 2002 and Keesing performed services for the IPFDC in 2002 and 2003.  Thereafter, Sanchez and Keesing entered into a brokerage and development agreement that was never presented to the IPFDC board for approval, and used the agreement as the vehicle to perpetuate their embezzlement scheme.  

Between Jan. 2005 and Nov. 2008, Keesing and NMREI submitted more than 100 invoices for professional services purportedly provided in connection with the development of the Albuquerque Indian School site.  Sanchez arranged for the IPFDC to pay the invoices, and in return, Sanchez and Tsachu, LLC, received more than 100 checks in the aggregate amount of $1,652,823.04 from Keesing and NMREI.  Although this illegally obtained money was taxable income, Sanchez did not report the income to the IRS.

Keesing pled guilty to Count 3 of the indictment charging him with aiding and abetting embezzlement from an Indian tribal organization, and Count 1 of the misdemeanor information charging him with the willful failure to file an income tax return.  Keesing’s plea agreement sets forth a detailed description of his role in the embezzlement scheme that defrauded the IPFDC of $3,575,000.00.  According to his plea agreement, Keesing shared these illegally obtained proceeds with Sanchez with Sanchez taking $1,652,823.00, and Keesing retaining the balance.  Keesing acknowledged that Sanchez provided nothing of value in return for this money and used Keesing as a conduit to receive IPFDC funds to which he was not entitled.  Keesing participated in the scheme to obtain additional compensation for work he previously performed on behalf of the IPFDC and for which he felt he was not adequately compensated.  Although the proceeds Keesing obtained from the IPFDC were taxable income, he failed to file federal tax returns reporting the income.

Sanchez and Keesing remain on conditions of release and under pretrial supervision pending their sentencing hearings, which have yet to be scheduled.  At sentencing, Sanchez faces a statutory maximum penalty of five years in prison on each of the two counts of conviction.  Keesing faces a statutory maximum of five years in prison on the embezzlement count and up to one year in prison on the tax count.  The plea agreements also require that Sanchez and Keesing pay full restitution to the IPFDC for the losses it sustained as a result of their criminal conduct.   

In announcing the guilty pleas, U.S. Attorney Damon P. Martinez said, “The IPFDC was established to develop real estate for the benefit of the 19 Pueblos of New Mexico and their people.  Bruce Sanchez was entrusted to spearhead that development.  Instead, Sanchez betrayed the people he was duty-bound to serve.”

“Mr. Sanchez and Mr. Keesing used their positions of power to line their own pockets at the expense of the members of New Mexico’s Pueblos. By pleading guilty today and accepting responsibility, the defendants have taken a positive first step in making amends for the harm they have caused,” stated IRS Criminal Investigation Special Agent in Charge Dawn Mertz.


Read the whole story here.

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