Brownsville Herald
Various Sources
International Educational Services closed its doors six months ago after an audit determined that employees profited when IES leased properties they owned and that executives paid themselves salaries that were hundreds of thousands of dollars more than what was allowed, according to documents obtained by The Brownsville Herald.
Those are just two of multiple reasons listed in a letter sent from the Administration for Children & Families to International Educational Services informing the nonprofit that its grant funding was coming to an end.
The nonprofit, which was formed in 1985, aimed to provide physical and educational care for unaccompanied migrant children entrusted to its care by immigration officials who detained the children.
IES closed on March 31 and terminated the jobs of hundreds of employees. No one with IES or the Office of Refugee Resettlement, the agency in charge of ACF, has said why the nonprofit closed.
Shortly after IES shuttered, The Brownsville Herald filed a Freedom of Information Act request with the ORR, ACF asking for any correspondence informing the nonprofit that the federal agency would not renew its grant funding.
Various Sources
International Educational Services closed its doors six months ago after an audit determined that employees profited when IES leased properties they owned and that executives paid themselves salaries that were hundreds of thousands of dollars more than what was allowed, according to documents obtained by The Brownsville Herald.
Those are just two of multiple reasons listed in a letter sent from the Administration for Children & Families to International Educational Services informing the nonprofit that its grant funding was coming to an end.The nonprofit, which was formed in 1985, aimed to provide physical and educational care for unaccompanied migrant children entrusted to its care by immigration officials who detained the children.
IES closed on March 31 and terminated the jobs of hundreds of employees. No one with IES or the Office of Refugee Resettlement, the agency in charge of ACF, has said why the nonprofit closed.
Shortly after IES shuttered, The Brownsville Herald filed a Freedom of Information Act request with the ORR, ACF asking for any correspondence informing the nonprofit that the federal agency would not renew its grant funding.
After nearly six months, the ORR, ACF, provided the newspaper with a seven-page letter sent on Feb. 21 to the nonprofit from E. Scott Lloyd, director of the ORR, ACF, informing IES that it would no longer receive nine grants to provide services for unaccompanied immigrant children.
That letter reveals a series of failures at IES identified during an audit conducted by the Office of Inspector General that began in June 2016.
“In September 2017, the OIG identified to ACF findings that included less than arms-length agreements related to property leases, violation of executive compensation levels, non-compliance with conflict of interest requirements and procurement procedures, and numerous examples of substantial failures of IES failing to comply with regulations governing allowable costs under (Health and Human Services) awards,” the letter states.
Starting on Nov. 2, 2017, the federal government placed IES on costs reimbursement restrictions due to concerns about the organization’s lack of effective control over, and accountability for federal funds, property and other federal assets , according to the letter.
The OIG audited IES for the Fiscal Year 2015, which began Oct. 1, 2014, and ended Sept. 30, 2015.
However, all the names in the letter, including who the document is addressed to, are redacted because the federal agency determined that significant privacy interest in those identities could lead to an unwarranted invasion of privacy because the identities of those individuals are contained in a law enforcement file.
“Information has been redacted pursuant to Exemption 6 and pertains to the identities of individuals who have been named in a law enforcement file. Disclosure of this information would cause a clearly unwarranted invasion of personal privacy,” a letter to the newspaper states.
According to the ORR, ACF, the mention of an individual’s name in a law enforcement file will engender comment and speculation and carries a stigmatizing connotation.
EXECUTIVE COMPENSATION
The letter reveals that five employees at IES earned more than the $183,300 salary limit set by the grant, with the two highest paid individuals earning $300,000 more than that amount.
Based on an OIG review of W-2s, the five individuals were paid $506,003.22, $492,001.62, $377,060.96, $208,190.49 and $185,000.06.
While those five names are redacted, tax documents filed by IES for 2015 reveal the salaries of IES’ highest paid employees.
The nonprofit’s 2015 tax filings show that IES President Ruben Gallegos earned $519,200; Chief Operating Officer Ruben Gallegos Jr., the president’s son, made $505,202; Chief Financial Officer Juan J. Gonzalez earned $390,273; Vice President of Business Affairs Norberto Perez made $201,601; and grant writer Nelly Weaver earned $194,414. All of those figures include benefits.
(The newer returns for I.E.S. show that the salaries increased tremendously – by more than $100,000 for Gallegos Sr. and Jr. – the following year. See graphic. Click to enlarge.)
(Eduardo Andres Lucio is Texas State Rep. Eddie Lucio III, and is listed as receiving $125,000 a year as I.E.S. legal counsel. Since the story was published, they have erased all the pictures together on theirt Facebook page, especially when Ruben calls Eddie his business partner. Shouldn't the state rep have known better?)
The 2015 tax filing only lists five employees earning more than the $183,300 salary limit, but those salaries listed in the tax filings do not match the salaries the OIG took from W-2s, even when benefits are not included.
“IES did not comply with the award terms and conditions regarding the Federal Financial Accountability and Transparency Act of 2006 (FFATA), executive reporting requirements which requires large grantees to report the compensation of its top five paid employees,” the letter states.
The tax filings indicate that Ruben Gallegos set salaries.
According to the ORR, ACF, the Notice of Award for IES clearly stated that this condition applied to the IES grants.
Ruben Gallegos Jr. told The Brownsville Herald he wished he could give an interview about IES’ closure, but due to negotiations with the federal government regarding the nonprofit that he was unable to comment.
“Right now, we are in the middle of negotiating with the federal government. There is nothing that I can say on the record right now,” Ruben Gallegos Jr. said.
A phone number provided for Ruben Gallegos by Texas Southmost College, where he served as a trustee was disconnected.
That letter reveals a series of failures at IES identified during an audit conducted by the Office of Inspector General that began in June 2016.
“In September 2017, the OIG identified to ACF findings that included less than arms-length agreements related to property leases, violation of executive compensation levels, non-compliance with conflict of interest requirements and procurement procedures, and numerous examples of substantial failures of IES failing to comply with regulations governing allowable costs under (Health and Human Services) awards,” the letter states.Starting on Nov. 2, 2017, the federal government placed IES on costs reimbursement restrictions due to concerns about the organization’s lack of effective control over, and accountability for federal funds, property and other federal assets , according to the letter.
The OIG audited IES for the Fiscal Year 2015, which began Oct. 1, 2014, and ended Sept. 30, 2015.
However, all the names in the letter, including who the document is addressed to, are redacted because the federal agency determined that significant privacy interest in those identities could lead to an unwarranted invasion of privacy because the identities of those individuals are contained in a law enforcement file.
“Information has been redacted pursuant to Exemption 6 and pertains to the identities of individuals who have been named in a law enforcement file. Disclosure of this information would cause a clearly unwarranted invasion of personal privacy,” a letter to the newspaper states.
According to the ORR, ACF, the mention of an individual’s name in a law enforcement file will engender comment and speculation and carries a stigmatizing connotation.
EXECUTIVE COMPENSATION
The letter reveals that five employees at IES earned more than the $183,300 salary limit set by the grant, with the two highest paid individuals earning $300,000 more than that amount.
Based on an OIG review of W-2s, the five individuals were paid $506,003.22, $492,001.62, $377,060.96, $208,190.49 and $185,000.06.
While those five names are redacted, tax documents filed by IES for 2015 reveal the salaries of IES’ highest paid employees.
The nonprofit’s 2015 tax filings show that IES President Ruben Gallegos earned $519,200; Chief Operating Officer Ruben Gallegos Jr., the president’s son, made $505,202; Chief Financial Officer Juan J. Gonzalez earned $390,273; Vice President of Business Affairs Norberto Perez made $201,601; and grant writer Nelly Weaver earned $194,414. All of those figures include benefits.
(The newer returns for I.E.S. show that the salaries increased tremendously – by more than $100,000 for Gallegos Sr. and Jr. – the following year. See graphic. Click to enlarge.)
“IES did not comply with the award terms and conditions regarding the Federal Financial Accountability and Transparency Act of 2006 (FFATA), executive reporting requirements which requires large grantees to report the compensation of its top five paid employees,” the letter states.
The tax filings indicate that Ruben Gallegos set salaries.
According to the ORR, ACF, the Notice of Award for IES clearly stated that this condition applied to the IES grants.
Ruben Gallegos Jr. told The Brownsville Herald he wished he could give an interview about IES’ closure, but due to negotiations with the federal government regarding the nonprofit that he was unable to comment.
“Right now, we are in the middle of negotiating with the federal government. There is nothing that I can say on the record right now,” Ruben Gallegos Jr. said.
A phone number provided for Ruben Gallegos by Texas Southmost College, where he served as a trustee was disconnected.
IES LEASES
The ORR, ACF, tells IES in the letter that it failed to comply with conduct standards after the OIG audit revealed that family members received compensation under IES awards.
The names of those family members are redacted, though tax filings show that the two top executives at IES are related, Ruben Gallegos and Ruben Gallegos Jr., father and son. However, because of the redactions, the letter doesn’t reveal whether the ORR, ACF, is referring to Ruben Gallegos and Ruben Gallegos Jr. or other family members employed by IES.
According to the letter, “recipients are required to establish safeguards to prevent employees, consultants, members of governing bodies and others who may be involved in grant supported activities from using their positions for purposes that are, or give the appearance of being, motivated by desire for private financial gain for themselves or others, such as those with whom they have family, business, or other ties.”
The letter states that someone doing business as Ideal Realty maintained more than a dozen less than-arms-length leases with IES of either land or buildings.
Another person whose name is redacted also maintained a number of less than arms-length leases either by doing business as ILT Enterprizes or through a limited Partnership of GaCris, LP.
IES tax filings from 2015 show that GaCris received a $42,200 deposit from the nonprofit. (GaCris is owned by Gallegos Jr. and Luigi Cristiano, a former Port of Brownsville commissioner. A list of other "contactors" on the IRS report is below. Click on graphic to enlarge.)
Texas Comptroller records indicate that Ruben Gallegos Jr. is the director of ILT Enterprizes.
However, an independent audit conducted for Fiscal Year 2016, the same year the OIG initiated its audit, provides insight into some of those leases.
That audit states that Ruben Gallegos owns an ILT Enterprise, which owns the Los Fresnos Corporate Office, two portable buildings in Driscoll, the Arroyo City Recreational Area and the Los Fresnos Shelter. IES paid ILT Enterprise thousands of dollars during the Fiscal Year 2016 to lease those properties, including $259,800 annually for the Los Fresnos Shelter.
The Texas Comptroller’s Office does not list an ILT Enterprise, though it does list ILT Enterprize.
That same audit states that IES leased a portable building for the Los Fresnos Shelter from Gonzalez, the finance director, for $26,400 a year. The 2016 audit also notes that IES leased another portable building from a “related party” at the Los Fresnos Shelter for a total of $26,400.
Finally, that audit states that IES held a total of 12 leases for buildings, land, parking lots, recreational areas and portable buildings from its president, Ruben Gallegos, for a total of $855,660.
This audit states that all related-party lease agreements were approved by IES’ board of directors and by the ORR, ACF.
The OIG audit, however, states that more than a dozen leases with IES violated federal standards that establish safeguards to prohibit employees from using their positions for a purpose that constitutes or presents the appearance of personal or organizational conflict, interest or personal gain.
“In addition, IES appears to have entered into more than a dozen leases with Ideal Realty, which the leases show was a corporation controlled by [redacted] (the leases are actually between IES and [redacted] “dba Ideal Realty.”)
IES also charged full rental for these leases, rather than following the regulations that would govern less than-arms-length transactions,” the letter to IES states. “Yet another lease shows that IES knowingly entered into lease agreements with [redacted] and, apparently, [redacted] relative [redacted] for portable structures. [Redacted] is the [redacted] of IES.”
Throughout tax filings between 2013 and 2015, IES admitted that an officer, director or key employee had family or business relationships with another officer, director, trustee or key employee.
However, in each of those years, on those same tax filings, IES states that it was not a party to a business transaction with a current or former officer, director, trustee or key employee; any family member of the same list; and any entity which a current or former officer, director or key employee, or family member thereof, was an officer, director, trustee or direct or indirect owner.
Throughout tax filings between 2013 and 2015, IES admitted that an officer, director or key employee had family or business relationships with another officer, director, trustee or key employee.
However, in each of those years, on those same tax filings, IES states that it was not a party to a business transaction with a current or former officer, director, trustee or key employee; any family member of the same list; and any entity which a current or former officer, director or key employee, or family member thereof, was an officer, director, trustee or direct or indirect owner.
To read rest of story, click on link: https://www.brownsvilleherald.com/news/local/ies-migrant-shelter-under-scrutiny-of-government/article_3fbaacfe-c442-11e8-905f-73378a9fc251.html
36 comments:
Probably donating $10,000 for scholarships in his behalf, courtesy of Federal Government. One among others. Very generous of him! Just saying!
Gallegos, Cristiano. They’ll just take their money they took from the government and find someone else to steal from. No need to write a story. Nothing is going to happen to them.
,bunch of greedy bastards hope the feds figure out how many were related to each other marines.
They should have consulted with Cameron County Workforce Solutions, they have experience scamming the govt.
Ratas, Ratas, Ratas...I hope they go to jail, because the Gallegos are LOW LIFE SCUMS.
Call in the Texas Rangers fraud squad, don't let them get away with this, it is clear case of theft, fifty years for the theft of meat, stealing millions? Send them to jail for fifty years and send them a message.
The DA Luis Saenz must show you got the BALLS, and go after these bandits and go Muslim on them, CHOP OF THEIR HANDS.
Saludando con sombrero ajeno. Bola de ratas! Se necesita renombrar Gallegos Elementary. Que sin vergüenza!
There is no more money as we are now all rich, all our family members are rich and we are untouchable as we are well covered Hahaha all the way to our hiding places.
Nice Gig for a bunch of fat fucking Crooks.
Now is E3 going to earn his 125k or was his name there just for the payday.
RATAS
Mark Reagan is fast proving himself as a true investigative reporter - someone Brownsville hasn't seen the likes of since Emma Trevino-Perez. How refreshing to have a Herald reporter dig into the story, instead of digging into the free pizza, beer and wine (and maybe $?) as compensation to write a complementary (to also complement their low wages, as some do at the Herald) story about a new business! Mark gives hope to the outdated Herald.
What about Gayle Curry, Ruben Gallegos other woman for years!! She came in and took over the whole company so he would t have to pay her any more hush money or side piece money! She had no experience but she was the boss?!! He had condos on the island, port Isabel and Corpus Christi, paid by your tax dollars! The boss always bought girls from his facilities. Easy pay for those girls but ewwww!
Oh and the III NEVER EVER was in the office!! 40 hrs?!! Cuandoooo
No wonder he gave out money left and right. Those $10,OOO were probably the money he used to bribe the board members to name the library at Gallegos Elem for his wife, Norma. Using my money to name things after him and his wife and rest of family. Que tal?
These pigs have been feeding at the public trough for YEARS! The Sucios and the IES boys are PROS at it! Look at their tax filings very carefully. Some of their vendors made MILLIONS as well. Could the 'Hector Pena' listed as a vendor possibly be the ex-County Commissioner?? Remember, the one that had phantom students going to imaginary classes years ago at TSTC?? Didn't current Cameron Workforce Executive Director work with him at TSTC during that period??
I REPEAT: This is the same old gang that has been feeding at the public trough for YEARS!
I wonder if the Feds are going to invoke the RICO on these characters?? We shall see.
I have a lot of respect for Dr. Gallegos, but this report does not pass the smell test.
Just remember that this finding was based on an audit from Oct. 1, 2014, through Sept. 30, 2015. Being that this is only one year of many years in operarion, you can only imagine how much more was illegally gained before and after by the IES and the Gallegos'. IES was nothing more than cover for a criminal organization no better than the cartels to the south. They used children in need of help for illicit and personal gain. Sad.
Mark Reagan, keep digging into the Gallegos finances. They stole millions from the government and taxpayers, you seem to be a good investigative reporter, just like Juan Montoya. Go guy's nail this crooks, because they are crooks !
FAR OUT! AN HONEST TO GOODNESS REPORTER!!! Mark Reagan is hands down the only Herald reporter who can write a true story without being jaded by handouts, free booze and food and legal advice.
Yeah. I been wondering about that guy who writes these really shiny stories about all the new business in Btown. He's a short guy Ive seen around town with his fat girlfriend and I know for a fact they eat and drink for free. Turns out he works for the paper and he gets kickbacks for writing good stuff about every new business in town. I even heard he got free legal representaion from Tony the mayors office just because he is agreeable in his covering of his policy. No wonder Herald is going down the tubes. Still isn't any excuse for low pay to take kickbacks
Now those are big rats.
The Fed's and the Texas Rangers had a meeting and decided that they would need at least a few dozen more people to start to investigate all the the corruption in Brownsville, they would have to close the city down as the Corruption is so wide spread where would they start, if they were to start with the city, that would involve the Mayor, that would involve GBIC and the BEDC that would involve the PUB, and on it goes. Now we have this knew bunch that is without the BISD, and then we have Luis Saenz, where will we find fifty Texas Rangers or Fed's, so life goes on. As for the Herald reporter, he will not last long telling the truth, what a brave man and such a short career in Brownsville.
He has a fucking slot machine tattoo on his chest!!
Can you be more cheap, unclassy, cheap, white trash than that?
Really bruh.. a slot machine on your chest, forever? LOL.. how embarrassing bruh.
HE HAS BIG BALLS TO REPORT THIS MESS....MY HATS OFF TO YOU REPORTER REAGAN...KEEP UP THE GREAT WORK ON REPORTING CORRUPTION ON THESE PEOPLE!!!!
More names will come out. Cristiano will squeal like a fat pig in jail.
Gallegos family are all crooks. They deserve to be in jail for stealing federal and taxpayers money. Hope the Fed's catch up to them, they are evil people, not good people.
The Gallegos family might as well leave the Valley for their own good. They have proven to be pure low life theives as they have clearly demonstrated. They need to start a new life where nobody knows them. The whole family has been smeared. Sad what greed can do to ruin the double life they are living. They have a reputation for being big gamblers. Finally the greed caught up with them.
The Gallegos family might as well leave the Valley for their own good. They have proven to be pure low life theives as they have clearly demonstrated. They need to start a new life where nobody knows them. The whole family has been smeared. Sad what greed can do to ruin the double life they are living. They have a reputation for being big gamblers. Finally the greed caught up with them.
Is this surprising that a Lucio name comes up in this corruption. Remember, the older Lucio came up in the investigation of the Truck-Rail bridge when Bustero, that fat crook was in charge of the Port. Over 22 million disappears, and no one asked a question about it?
Then, you had Armando "Wolf in Sheep' Clothing" Villalobos investigates and $1 Million is paid back by Dannebaum, the leading crook.
Was anyone ever indicted? Oh, a sealed indictment, but who?
I guess the apple doesn't fall far from the tree when its the Lucio'
The Gallegos are Crooks, get them out of town.
The Gallegos are inbred, thieving rats. Goes to show anyone can get a Drs. Degree. Write a Barrio journal and call it a book.
Wow! I wish I had the cash to get a slot machine tattoo. Now that's some real classy shit there.
Way to go Mark Reagan and Juan Montoya for the great stories exposing these crime families. There is MORE. Keep digging.
The Lucios are RATAS, the Gallegos are RATAS, and the DA Saenz is a a pussy!!!
WOW
I knew Ruben Gallegos at J.T. Canales in the early 1960's when I was a 6th grade teacher. Ruben was our vice principle, and I always admired him as a professional educator. Later, we even visited with each other when we were both working on our doctorates. He was visiting the North Texas campus from East Texas State. I will always remember he gave me some mature professional advice for which I will never forget. It saddened me to read about his involvement in this IES scandal from the Brownsville, Herald. This is not the Ruben Gallegos I knew from J.T. Canales elementary school.
Whatever happened to these RATAS?
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