SAN ANTONIO — A former U.S. Small Business Administration chief’s criminal trial is set for April in San Antonio after a federal judge shot down a motion to dismiss the indictment, which alleged conflicts of interest among federal investigators in the case.
Prosecutors say Barreto diverted some of the donations to his tequila company and to pay for vacations, meals and entertainment.
He counters the donations to the Latino Coalition Foundation and the Hispanic Business Roundtable Institute were actually funding the doctor’s political agenda.
The charges against Barreto include conspiracy to commit money laundering and four counts of conspiracy to commit wire fraud. The alleged scheme began in 2012 and continued until September 2021 when a federal grand jury indicted him.
On ExpressNews.com: Political intrigue in San Antonio criminal case against ex-WellMed consultant and former SBA boss
At a court hearing last week, Barreto’s lawyers asked U.S District Judge Jason Pulliam to toss the charges based on “outrageous government conduct” by the FBI case agent, Monroe Giese.
Emails turned over by prosecutors as part of discovery in the case show Barreto and his co-defendant provided “political consulting services” to Giese’s wife in 2015 when she was vying to become U.S. attorney for the Western District of Texas, according to Barreto’s motion.
Barreto argued that the services he and his co-defendant — one-time WellMed consultant Miguel Gutierrez — provided Erica Benites Giese “drew from the same skill set they were simultaneously providing” to Rapier.
The San Antonio criminal case against former SBA chief Hector Barreto relates to how he allegedly used donations made by physician and entrepreneur George Rapier III and his ex-wife Kym Rapier Verette (both pictured) to two nonprofits. Dr. Rapier founded WellMed Medical Management.
LELAND A. OUTZ, FREELANCER / SPECIAL TO THE EXPRESS-NEWS
‘Serious concerns’
When she wasn’t selected for the post, the filing added, Barreto and Gutierrez were no longer “any value to her (and) this prosecution was subsequently born.”
“The juxtaposition of such events raises serious concerns in regard to conflicts of interest and the unavoidable question whether this prosecution would have ever come about had Ms. Benites Giese succeeded in getting the chief U.S. Attorney position,” Barreto said in the motion.
William Harris, an assistant U.S. attorney, said it was “ridiculous” to assert that the prosecution of Barreto was in retaliation for failing to help Erica Benites Giese become U.S. attorney.
“The suggestion that this prosecution is a result of vindictiveness caused by … Erica Giese’s failure to be nominated borders on scurrilous,” he said. “It is scurrilous.”
Jonathan Rosen, one of Barreto’s lawyers, denied they were being vindictive. He accused the FBI agent of exploiting a conflict of interest to “purportedly obtain tainted evidence regarding the underlying facts that are wrong.”
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An FBI spokeswoman had no comment.
A spokesman for Erica Benites Giese called Barreto’s motion “a frivolous litigation tactic at its very worst and amounted to nothing more than a desperate and silly attack.” She is now in private practice and recently sought the U.S. attorney post again. But President Joe Biden last month selected Jaime E. Esparza, who led the El Paso County District Attorney’s Office for nearly three decades, for the job.
Pulliam quickly ruled against Barreto’s motion to dismiss, noting there’s a high burden of proof for a defendant asserting outrageous government conduct. Barreto couldn’t prove either of the two prongs required for dismissal: that there was substantial government involvement in the offense and that he played a passive role, the judge determined.
Erica Benites Giese worked in the U.S. attorney’s office’s civil division in 2018 when the criminal investigation against Barreto began, Pulliam also said in his ruling.
Barreto’s lawyers could still seek to bring up the allegations at trial, but prosecutors also could seek to preclude it. Manny Medrano, a Los Angeles lawyer for Barreto, didn’t respond to requests for comment.
Medrano succeeded in getting the judge to postpone the trial. It had been scheduled for Dec. 5 but now is set for April 17.
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Hector Barreto speaks at the Republican National Convention in 2000. He was indicted last year by a San Antonio federal grand jury.
RON EDMONDS, Staff
Rapier subpoena
Meanwhile, Medrano said he would have a subpoena served on Rapier to get certain records. Rapier’s lawyer said at least week’s hearing he would file a motion to quash the subpoena. Rapier previously filed a motion to quash a subpoena for tax records sought by Gutierrez.
The motion became moot when Gutierrez accepted a deal from prosecutors. He pleaded guilty to conspiracy to commit wire fraud and failing to file a tax return and is expected to testify against Barreto.
Barreto isn’t seeking Rapier’s tax returns, Medrano told the judge. Instead, he’s seeking records that Medrano said will support the defense’s theory that the doctor had carried out similar transactions to disguise his political activity before Barreto entered the picture.
Before pleading guilty, Gutierrez accused Rapier of using the Latino Coalition Foundation and the Hispanic Business Roundtable Institute to conceal his political spending, which is not illegal. Gutierrez alleged Rapier intended to take federal tax deductions for his political advocacy, which is not allowed under the tax code.
In particular, Gutierrez alleged Rapier had hid his political activity, including get-out-the-vote campaigns for conservative candidates and to stymie the Affordable Care Act, known as Obamacare.
The foundation was formed to enhance the economic development of Latinos, while the institute was created to promote public awareness of issues affecting Latinos.
pdanner@express-news.net