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FBI Is Probing Corruption in Puerto Rico Government Contracts

FBI Is Probing Corruption in Puerto Rico Government Contracts

(Bloomberg) -- The U.S. Federal Bureau of Investigation is probing potential corruption and favoritism in how Puerto Rico awarded some government contracts and arrests may be forthcoming, according to the bureau’s special agent in charge on the island, Douglas Leff.

Speaking Thursday on local station Radio Isla, Leff said prosecutors would have final say as to when enough evidence had been gathered to justify arrests.

The remarks come during an extraordinary week in which Puerto Rican Treasury Secretary Raul Maldonado used a radio interview to disclose an "institutional mafia" within his own secretariat, revealed an FBI probe into the matter, and subsequently lost his job for failing to tell the governor about the problems before going to the press.

Then, just hours after Maldonado was asked to resign, his own son took to social media to call Governor Ricardo Rossello himself "corrupt," purporting to offer a firsthand account of the governor’s efforts to alter a report on Hurricane Maria aid, an episode which Rossello vehemently denied had taken place.

Until now, the FBI hadn’t spoken out on the matter. Leff confirmed the existence of widespread probe into improper awarding of government contracts at various levels of government, although he declined to specifically say if the Treasury was involved.

"It’s fair to say that this is going to be a very busy summer for us," he said, adding that an announcement may be forthcoming as soon as this week.

The corruption drama and insult-slinging could hurt Puerto Rican leaders’ efforts to restore confidence in their stewardship. The island commonwealth is navigating a record-setting bankruptcy and trying to ensure that federal aid money keeps flowing to recover from the devastation of Hurricane Maria.

To contact the reporter on this story: Jonathan Levin in Miami at jlevin20@bloomberg.net

To contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, William Selway, Allan Lopez

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