DALLAS – Former Crystal City, Texas, city manager and city attorney William James Jonas III was sentenced to 35 years in prison and ordered to pay more than $1 million in restitution in a federal bribery and fraud case that toppled the city’s leadership and is entangled in a bond default.
The sentence, including $17,291 in fines, was handed down Wednesday by U.S. District Judge Alia Moses in Del Rio.
Jonas, who worked as a lobbyist after holding both city manager and city attorney posts, represented himself in the case.
The allegations against Jonas included the misuse of bond proceeds for his own benefit.
“Judge Moses imposed a just sentence for Mr. Jonas’s staggering betrayal of the public trust—a betrayal that left Crystal City nearly insolvent,” said U.S. Attorney John F. Bash. “But this was surely not an isolated incident. My office is committed to rooting out public corruption throughout Central and West Texas.”
A federal jury on June 26, 2017 convicted Jonas of one count of conspiracy to commit bribery involving federal programs, three counts of bribery involving federal programs, one count of conspiracy to commit wire fraud and theft of honest services, five substantive counts of wire fraud and theft of honest services, and four counts of wire fraud.
Jurors also convicted former Crystal City Mayor Ricardo Lopez of one count of conspiracy to commit bribery involving federal programs, one substantive count of bribery involving federal programs, one count of conspiracy to commit wire fraud and theft of honest services and four substantive counts of wire fraud and theft of honest services.
Testimony during trial, according to the U.S. Attorney's Office, revealed that between May 2012 and February 2016, Jonas, Lopez, and other city officials used their official positions to enrich themselves by soliciting and accepting bribes from persons seeking to do business in Crystal City. Jonas and Lopez also used emails, texts and phone calls to carry out their scheme to defraud Crystal City and its citizens through bribery and the concealment of information.
Testimony revealed that Jonas was involved in a wire fraud scheme in connection with a multi-million-dollar debt offering in December 2014 that was earmarked for various improvements to the city’s infrastructure, including replacing the city’s water meters, certain heating and air conditioning equipment, and lighting.
Crystal City agreed to place the $2.25 million generated by the sale of the unrated tax-exempt certificates of obligation into separate accounts and to use those funds only for specified purposes. Instead, prosecutors said, Jonas caused those monies to be deposited into the city’s general fund in December 2014, where the funds were used to pay for Jonas’ salary and other unauthorized expenditures.
The city has failed to make bond payments since 2016, according to filings posted on the Municipal Securities Rulemaking Board's EMMA website by underwriter Crews & Associates, Inc., which reported taking the city to court in pursuit of the payments.
According to the indictment, the balance in the city’s general fund after the deposit of the raised funds was $2,207,050.62. The balance in the city’s general fund on Oct.31, 2015, was $2,199.95. On Nov. 6, 2015 Crystal City still owed about $735,048.79 in payments to the company that performed the infrastructure improvements, the indictment said.
Investigators in the case came from the San Antonio Police Department and the Texas Department of Public Safety along with those from the FBI. The Crystal City investigation is one of several that have taken place in South Texas to root out corruption among public officials.
“This case reflects our commitment to the citizens of Crystal City to aggressively and relentlessly root out criminal corruption in our community,” said Christopher Combs, Special Agent in Charge of the FBI’s San Antonio Office. “Officials who betray the public and violate their oath of office will be thoroughly investigated and exposed.”
Also sentenced in the Crystal City case was businessman Ngoc Tri Nguyen, who served 17 months for fraud. In May 2016, Nguyen pleaded guilty to a federal programs bribery charge admitting that he paid $6,000 in bribes in exchange for various official acts from his co-defendants.
Lopez faces up to five years in federal prison for the conspiracy to commit bribery charge, up to 10 years in federal prison for each bribery related charge, and up to 20 years in federal prison for each wire fraud related charge.
Former Mayor Pro-Tem Rogelio Mata, former City Councilman Roel Mata and former City Councilman Gilbert Urrabazo have pleaded guilty to a federal programs bribery charges and face up to 10 years in federal prison and up to a $250,000 fine, investigators said. Moses is scheduled to sentence all four former city officials June 11in Del Rio.