On July 10, 2019, the Federal Bureau of Investigation made arrests in connection with a 32-count indictment alleging that Julia Keleher, the former Education Secretary of Puerto Rico, and Angela Avila Marrero, the former Executive Director of the Puerto Rico Health Insurance Administration, illegally steered millions of dollars in federal contracts to politically connected consultants (the Arrests). Patricia Mazzei, Puerto Rico Ex-Officials Accused of Steering $15.5 Million in Contracts to Consultants, The New York Times (July 10, 2019). The Arrests are another tragic chapter of Puerto Rico’s history of public corruption. FBI: Puerto Rico cops protected cocaine dealers, CNN (Oct. 7, 2010).

Consequences of the Arrests. The Arrests will have profound consequences for Puerto Rico and the PROMESA bankruptcy cases. An immediate consequence of the Arrests is that Congressman Raul Grijalva, Chairman of the Natural Resources Committee that has jurisdiction of Puerto Rico, has called for the resignation of Governor Ricardo Rossello. Jeff Stein, FBI Makes Arrests in Puerto Rico Corruption Scandal, Prompting Calls for Governor’s Ouster and Concerns about Billions in Storm Aid, The Washington Post (July 10, 2019). Congressman Grijalva’s lack of confidence in the government of Puerto Rico will adversely affect federal funding for Puerto Rico. After approximately two years Puerto Rico still has not recovered from Hurricane Maria. Greg Allen & Marisa Peñaloza, I Don’t Feel Safe’: Puerto Rico Preps for Next Storm Without Enough Government Help, NPR (July 3, 2019). The Arrests will probably create a moratorium for federal funding for Puerto Rico until the Congress and President are comfortable that effective anti-corruption measures have been implemented in Puerto Rico.