Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Lesley Brovner, Acting Commissioner of the New York City Department of Investigation (“DOI”), and James D. Robnett, the Special Agent-in-Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), announced today that ELIANA BAUTA, GERALDINE PEREZ, and ERIC GONZALES were charged in Manhattan federal court with six counts related to their theft of over $300,000 in funds from the New York City Human Resources Administration (“HRA”). BAUTA perpetrated the offenses in her capacity as an HRA employee. PEREZ is also charged with a separate fraudulent scheme involving over $90,000 of stolen or fraudulently issued Treasury checks. BAUTA was arrested by the U.S. Marshals in Florida, and was presented in the United States District Court for the Middle District of Florida this afternoon. PEREZ and GONZALEZ will appear tomorrow for presentment in the Southern District of New York before Magistrate Judge Gabriel W. Gorenstein.
Manhattan U.S. Attorney Geoffrey S. Berman said: “As an HRA employee, Eliana Bauta was supposed to help New Yorkers in need. Instead, she and her co-defendants allegedly helped themselves, stealing hundreds of thousands in emergency benefits funds. As today’s arrests make clear, we will not tolerate alleged abuses of trust in City agencies, and we remain committed to ensuring that federal and local funds go to the intended recipients, not the pockets of unscrupulous employees and their families and friends.”
IRS-CI Special Agent-in-Charge Robnett said: “When stolen identities are used to file fraudulent tax returns, it robs all of us. IRS-CI will investigate these alleged crimes and protect this country’s tax administration.”
According to the allegations in the Complaint filed today in Manhattan federal court:[[1]]
HRA is an agency of the City of New York responsible for administering the majority of the City’s public assistance programs. Among other things, HRA provides temporary, emergency cash assistance to individuals and families with social service and economic needs to assist them in reaching self-sufficiency. The emergency assistance is funded by the federal government as well as by New York State and City.
Since in or about 2015, DOI has been investigating two related schemes in which an HRA employee – ELIANA BAUTA – defrauded HRA and the City of New York by using her position to commit public assistance fraud. BAUTA worked as a Job Opportunity Specialist for HRA from approximately January 2008 to on or about May 23, 2018. As a Job Opportunity Specialist, BAUTA was at various points responsible for interviewing benefits applicants, compiling and submitting applicants’ paperwork, and disbursing applicants’ benefits.
In the first of the two schemes, BAUTA is alleged to have caused the fraudulent issuance of emergency benefits funds to relatives and acquaintances, including GERALDINE PEREZ and ERIC GONZALES, among others, who in truth and in fact did not qualify for those funds. For example, BAUTA altered a police report submitted by an actual HRA client by changing the name of the victim to a family member’s name, and then entered the doctored report into HRA systems in support of a request for benefits to be issued to that family member. On another occasion, BAUTA submitted a request for emergency benefits to be issued to an individual after an alleged disaster, but no such disaster had occurred, and the payments were intended to repay that individual for putting a supernatural curse on BAUTA’s ex-boyfriend. Both PEREZ and GONZALEZ were knowing recipients of such fraudulently issued funds and shared the proceeds with BAUTA.
In the second scheme, BAUTA is alleged to have obtained access to and misappropriated emergency benefits checks issued to actual HRA clients. Instead of providing the checks to the legitimate clients in need of emergency funding, BAUTA gave them to PEREZ and GONZALES, among other of BAUTA’s relatives and associates, who deposited the checks in their own bank accounts and withdrew the funds, and then shared the proceeds with BAUTA. In total, the two schemes resulted in losses to HRA of at least $309,000 in public funds.
In addition to obtaining stolen HRA checks into her bank account and the bank accounts of family members, PEREZ is also alleged to have deposited or caused to be deposited into these same accounts improperly obtained United States Treasury checks that were issued to other individuals as tax refunds. In total, 23 such checks worth over $91,000 were deposited into bank accounts of PEREZ and her family members and associates. PEREZ then split the proceeds with a tax preparer who assisted in the scheme.
ELIANA BAUTA, 35, GERALDINE PEREZ, 60, and ERIC GONZALES, 26, all of the Bronx, New York, are each charged with one count of conspiracy to commit federal program theft, which carries a maximum sentence of five years in prison; two counts of federal program theft, each of which carries a maximum sentence of 10 years in prison; one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison; and one count of conspiracy to commit bank fraud, which carries a maximum sentence of 30 years in prison. BAUTA is also charged with one count of aggravated identity theft, which carries a mandatory consecutive sentence of two years in prison. PEREZ is also charged with one count of receiving stolen government money or property, which carries a maximum sentence of 10 years in prison. The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by the judge.
Mr. Berman praised the investigative work of DOI and the IRS, and noted that the investigation is continuing.
The charges contained in the Complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
