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$4M HUD Scam: VI Officials Busted for Hurricane Wood Heist
St. Croix, VI – In a shocking turn of events, a federal grand jury has returned an indictment charging two Virgin Islands government officials and a contractor in a $4 million dollar HUD fraud scheme related to hurricane wood storage and management.
According to court documents, Department of Education Director of Maintenance Davidson Charlemagne, 50, and his wife Sasha Charlemagne, 44, both of St. Croix, were arrested after a two-year investigation revealed a web of deceit and corruption that exploited hurricane recovery efforts for personal gain.
The indictment alleges that the Charlemagnes, along with former Virgin Islands Housing Finance Authority (“VIHFA”) Chief Operating Officer Darin Richardson, 56, of St. Thomas, conspired to defraud taxpayers out of $4 million in HUD funds meant for the storage and management of wood shipped to the Territory to rebuild after Hurricanes Irma and Maria in 2017.
As part of the scheme, the Charlemagnes’ company, ISG and D&S Trucking, submitted a bid to VIHFA for a contract to store and manage the woodpiles on both islands at a cost of $2,993,500.00 over a three-year period. The proposal included outrageously inflated labor estimates, with a warehouse manager earning $120,000.00 per year and a forklift driver earning $100,000.00 per year, when in reality, these positions average around $64,000.00 and $41,000.00 per year respectively.
Charlemagne also certified in the proposal that his company had general and automotive insurance, which expired on December 18, 2020, but no evidence exists that he had insurance at the time of submission. Furthermore, he failed to disclose his employment as Director of Maintenance for the Virgin Islands Department of Education or that he would be obtaining rent-free warehouse space at Henderson Elementary School, a property owned by the Virgin Islands Government.
U.S. Attorney Delia L. Smith praised the diligent work of the Housing and Urban Development Office of Inspector General, Federal Bureau of Investigation, and the Small Business Administration Office of Inspector General, who worked tirelessly to uncover this conspiracy to defraud the citizens of the Virgin Islands.
The indictment charges the defendants with government program fraud, wire fraud, money laundering conspiracy, criminal conflict of interest, and making materially false statements. If convicted, the Charlemagnes face up to 20 years in prison, while Richardson faces up to 10 years.
The case serves as a stark reminder that those in power will be held accountable for their crimes, and the Department of Justice will continue to follow the money to bring justice to the people of the Virgin Islands.
Stay tuned for further updates on this developing story as more information becomes available.
Key Facts
- State: Virgin Islands
- Agency: DOJ USAO
- Category: Public Corruption|White Collar Crime|Fraud & Financial Crimes
- Source: Official Source ↗
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