Sept. 27, 2006 Walter John Jr., a 57-year-old former V.I. Housing Authority official, was convicted Wednesday by a federal jury on St. Croix of 25 counts of fraud and conspiracy in connection with a kickback scheme between himself and a St. Croix contractor.
According to the indictment, from January 1998 to September 1999, John agreed to pay contractor George Flemming, doing business as Mr. G's Maintenance Services, under a federally funded contract for the repair of 50 housing units.
In exchange for John expediting payments to Flemming ahead of other vendors, John would receive a kickback for each unit.
During the life of the contract, Flemming was paid $37,000.
Flemming was tried and convicted in July of 27 charges, including conspiracy and fraud.
The maximum statutory penalty for conspiracy to commit wire fraud and wire fraud is 30 years in prison and a $1 million fine. The maximum penalty for conspiracy to commit program fraud and program fraud is 10 years in prison and a $250,000 fine.
The investigation that led to the charges was conducted by the Department of Housing and Urban Development, Office of the Inspector General.
The case was prosecuted by assistant U.S. Attorney Denise Hinds, with the assistance of HUD special agent Edwin S. Bonano.
No sentencing date has been set for either John or Flemming, pending the preparation of a pre-sentence report, the release said.
