MAYOR, BEDC COVERED UP HILTS' CRIMINAL ACTS; TRO AN EFFORT TO REINSTATE GBIC'S $1.6 MILLION CONTRACT

"Salinas said he had told Martinez and Capella about the issues but that nothing had been done."

By Juan Montoya
The ongoing campaign engineered by Mayor Tony Martinez and several board members of the Brownsville Economic Development Council to appoint Nurith Galonsky and John Cowen to the Greater Brownsville Incentives Corporation in an effort to steer the $1.6 yearly contract back to the BEDC has culminated in a legal challenge to prevent the GBIC from appointing a new executive director.

BEDC PG. 1  BEDC PG. 2  BEDC PG. 3  BEDC PG 4

And new evidence uncovered by El Rrun-Rrun indicates that Mayor Tony Martinez, BEDC board members, and members of the board of the GBIC were aware of irregularities and potential criminal acts by former BEDC CEO Jason Hilts.

They were informed in a confidential letter sent by then-GBIC (and city) attorney Mark Sossi May 23, 2016 to the board. (click on letter to enlarge. Links below show entire letter.)

And even before that letter alerted GBIC board members, it indicates that Martinez and BEDC executive board member Tony Capella knew about the irregularities and potential criminal acts "many months" before and covered them up.

In one case, Hilts was suspected of forging an invoice for $5,000 from an existing Colombian company and asking that the funds be sent to the BEDC office in Colombia which was located in the house of a woman with whom Hilts was allegedly having a sexual affair.

A hearing on whether to dissolve the Temporary Restraining Order preventing GBIC from hiring Executive Director Mario Lozoya will be heard at 2 p.m. today in the 107th District Court before Associate District judge Louis Sorola today.

The TRO was issued by Sorola last Wednesday ex-parte (with only plaintiff Galonsky's side heard) and a hearing on whether to dissolve it or to issue an injunction will be made today after both sides have their say.

Galonsky was appointed to the GBIC board after a nomination of Esteban Guerra was defeated among complaints by city commissioner Jessica Tetreau that Martinez had not counted her vote. A second vote resulted in the appointment of Galonsky, known to have been the mayor's choice for the GBIC board.

If the GBIC is prevented from hiring an executive director, then the logical loutcome would be for the GBIC to hire the BEDC as it has fgor the previous 10 or so years. Its contract with the BEDC was about $5 million for a three-year period before the GBIC board declined to renew it last year citing a disconnect between its mission and the BEDC's non-performance on the contract.

In a letter dated May 23, 20l6, then-city attorney Mark Sossi wrote the GBIC board that former BEDC CEO Lizzy Putegnat had been making some "very serious allegations about financial improprieties involving the BEDC office in Colombia."

 In the four-page narrative that followed, Sossi outlined Putgenat's allegations that more than $100,000 per year, not including travel, was being spent on the Colombian mission"...(and that)...she thought the $50,000 a year paid to office manager Olga Ramos (a former Avon sales lady) was excessive and seemed to be motivated by "a personal relationship that (Hilts) was having with a Ms. Olga Ramos."

Putegant also told Sossi that the BEDC office was in actuality the residence of Mrs. Ramos and that the BEDC was subsidizing her residence with tax dollars because of her personal relationship with Hilts.

Sossi then met with Martinez and conveyed Putegnat's concerns only to have the mayor shrug them off and say that he had been told about the situation "many months ago" and that "he had disregarded them as they were nothing more than a disgruntled employee who had psychological problems (anorexia.)" Sossi said that Martinez had suggested that Putegnat was not a credible witness and had an "axe to grind" against the BEDC.

After some board GBIC board members expressed an interest in having Performance Review Committee to evaluate BEDC's performance, Sossi interviews several BEDC staff members and discovered that many of the same concerns expressed by Putegnat could be factually supported. He also learned that these concerns had been communicated to Martinez and Capella but that they had not been acted upon, relayed to the GBIC board, the City Commission or the
Brownsville Police Department.

Sossi then interviewed former BEDC vice-president (and current interim CEO for GBIC) Gilbert Salinas who corroborated the Putegnat allegations, but said he had told Martinez and Capell about the issues but that nothing had been done. He said he had not informed the GBIC board because he was afraid to lose his job.

Salinas had a large white page filled with handwritten notes of things he had been concerned about and told Sossi he had been keeping notes for almost a year. (Salinas, incidentally, was one of the three finalists for the GBIC CEO position as was Lozoya. It is known that Salinas was Martinez's and Galonsky's choice for the top position.)

1. BEDC Colombian Office Manager Olga Ramos:

A. Sossi wrote that Salinas told him that Ramos was paid a salary of more than $50,000, which was considered a high salary in Colombia. (at the current exchange rate, $50,000 US equals 143,081,985.98 pesos in Colombia. Currently, the average monthly wage in Colombia is $246 U.S.)

Sossi also wrote that Salinas told him his understanding was that Ms. Ramos had been an Avon sales lady previous to Hilts hiring her as the BEDC Colombia office manager.

B. Salinas told Sossi Hilts had once presented a medical bill from Ramos for payment by the BEDC,

C. Salinas also said he had been concerned that the amount of money spent by Hitls and other Brownsville officials appeared excessive. In previous reports, those amounts totaled $100,000s during the time the Colombian office was operating. When Capella pulled up the office on Google earth, he is a said to have exclaimed: "It's a house."

2. Forged Invoice to Olga Ramos

In late 205, Hilts presented an invoice FOR $5,000 to BEDC for payment for a Colombian vendor. He asked that the money to pay the invoice be wired to the Colombia office to Ramos so it could be paid out of that office. Upon investigation by Capella and Salinas, the owner of the Colombian company said his company had not performed any services for the BEDC and that the invoice had not been sent by his company. He denied his company had sent it and suspected it was a forgery.

When the owner offered to contact the Colombian police, Capella said it was not nececssary and that the BEDC would handle it on its end. Capella informed Hilts of the invoice and Hilts terminated Ramos over the incident. Hilts, according to Sossi, told different stories to different individuals as to why he had terminated Ramos.He told Capella he had fired Ramos over the forged invoice, and Salinas that he had terminated her because of the persistent rumors of the two having a sexual relationship.

3. Threat of a lawsuit 

After Hilts fired Ramos, she had her lawyer send the BEDC a demand letter threatening litigation. The letter arrived at BEDC and was received by staffer Hanie Velasquez, who turned it over to Hilts without making a copy. Hilts never communicated the fact to wither the BEDC, the GBIC or the city commission.

Depending on whether the court dissolves the TRO or imposes an injunction on the GBIC hiring new CEO Lozoya, the GBIC may be forced to reinstate its contract with the BEDC. Given Martinez and that board's cover up of their CEO's criminal activities, it would signal a message that the city is not serious about its economic development efforts or in protecting the public's funds.