Government House said this week it is reviewing a request from an attorney representing St. Thomas businessman Brett “Mac” McClafferty seeking an investigation into whether relationships between Banco Popular employees and Virgin Islands law enforcement influenced the criminal case filed against him.
The request was sent Tuesday in a letter to Gov. Albert Bryan Jr. by attorney Bradley P. Lehman of the law firm Whiteford, Taylor & Preston. Lehman wrote that his firm represents McClafferty and his business interests and asked the governor to order an investigation into what the letter describes as potential “inappropriate personal relationships” between bank employees and members of the Virgin Islands Police Department that could have affected the charging decision tied to McClafferty’s Feb. 21 arrest.
Government House confirmed it had received the request and said it is reviewing the matter.
Under Virgin Islands law, investigations into government operations may be conducted by the Office of the Virgin Islands Inspector General, an independent oversight office empowered to review allegations of fraud, waste, abuse, or misconduct involving government agencies or programs. The Inspector General may initiate inquiries on its own or at the request of the governor or the Legislature and can refer potential criminal matters to the Justice Department or other appropriate authorities. In cases where criminal prosecutions are already underway, oversight reviews are often handled by independent entities rather than prosecutors directly involved in the case.
The request comes about a week after a development in a related civil lawsuit filed by McClafferty and Social Hospitality Group Inc., the operator of St. Thomas Social, which is seeking $10 million in damages from Banco Popular de Puerto Rico and its parent company.
On March 5, Superior Court Judge Sigrid M. Tejo issued an order recusing herself from presiding over that civil case. In the order, Tejo wrote that during her previous service as an assistant attorney general, she worked closely with the Virgin Islands Police Department’s White Collar Crime Division and Banco Popular’s fraud department and had developed personal relationships with officers involved in those areas. She stated that stepping aside was appropriate to avoid even the appearance of impropriety or a potential conflict of interest.
Lehman’s letter to the governor references that recusal as part of a broader argument that the circumstances surrounding the case warrant review. The attorney wrote that Virgin Islanders “have a right to know that charging decisions are being made ethically and after due consideration,” and asked that the administration determine whether relationships between bank employees and law enforcement may have influenced the investigation or charging decision tied to McClafferty’s case.
The request follows the filing of a civil lawsuit on March 4 by McClafferty and Social Hospitality Group Inc., which accuses Banco Popular and Popular Inc. of negligence, defamation, abuse of process, false arrest, and intentional infliction of emotional distress. The suit alleges the bank improperly reported fraudulent activity connected to checks deposited into the company’s account, triggering the criminal investigation that led to McClafferty’s arrest.
According to the complaint, the dispute traces back to late 2023 after Social Hospitality Group opened business accounts at Banco Popular. The lawsuit states that a check connected to a proposed multiday medical symposium at St. Thomas Social was deposited by a former general manager and initially accepted before later being returned. The bank allegedly advised the business to obtain a replacement check from the event organizer, and a second check from the same source was later deposited and also returned.
The event ultimately never took place after the organizer died unexpectedly on St. Croix.
Months later, the lawsuit alleges, the bank accused the plaintiffs of knowingly depositing fraudulent checks and reported the matter to police.
Authorities allege that 12 fraudulent transactions totaling about $888,500 moved through the accounts, though Banco Popular reported a confirmed loss of more than $80,000.
Those allegations eventually resulted in felony charges against McClafferty. As previously reported by the Source, a Superior Court judge signed a warrant for his arrest on Dec. 30, 2025. The warrant was executed months later, when officers with the Virgin Islands Police Department’s Economic Crimes Unit arrested McClafferty at his residence on Feb. 21.
Prosecutors charged him with grand larceny, passing or possessing forged bills, obtaining money by false pretenses, making and passing fictitious bills and delivering worthless checks. At an advice-of-rights hearing days later, Magistrate Judge Julie Todman Smith found probable cause for the charges and set bail at $150,000. McClafferty was released after posting 10% of the bond in cash, with the remainder unsecured.
The criminal charges remain pending in Superior Court.
In the civil filing, the plaintiffs argue the bank failed to properly investigate the deposits, maintain accurate records of who made the transactions or follow internal safeguards before reporting alleged fraud to police. The complaint also alleges the bank’s handling of the matter wrongly tied the deposits to McClafferty, even though employees or other associates routinely made deposits on behalf of the business.
McClafferty, 37, describes himself as a private investor and philanthropist and is a co-owner of St. Thomas Social at Yacht Haven Grande. He is also listed as principal of Mac Private Equity and MPE Clearings and Holdings. The restaurant, its parent company Social Hospitality Group and McClafferty have been involved in a number of legal disputes in recent years, and Mac Private Equity filed a Chapter 7 bankruptcy petition in Delaware earlier this year. McClafferty has also faced landlord-tenant litigation tied to St. Thomas Social’s operations at Yacht Haven Grande, which was later dismissed without prejudice. In those matters, McClafferty has denied wrongdoing and characterized some claims as business disputes.
Meanwhile, both the civil lawsuit against Banco Popular and the criminal case against McClafferty remain pending. A press release accompanying the civil filing states that McClafferty has recused himself from the day-to-day operations of Social Hospitality Group and its properties while the legal matters proceed.
