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A federal judge on Thursday denied a motion to dismiss an indictment against former executives with International Educational Services Inc., or IES, and set a trial date for its former chief executive officer.
U.S. District Judge Fernando Rodriguez Jr. issued his order denying the motion that claimed federal prosecutors failed to allege an offense and that the allegations fall outside of the statute of limitations.
Attorneys for Ruben Gallegos Sr., the former chief executive officer, and for Ruben Gallegos Jr., the former executive director filed the motion on July 16, which remained under seal until Aug. 13. Two exhibits that accompanied the motion remain under seal.
The Gallegos’ have pleaded not guilty to conspiracy to embezzle money meant for the nonprofit and theft concerning programs receiving federal funds. Juan Jose Gonzalez, the nonprofit’s former finance director, pleaded guilty in April to those same charges. He faces up to 10 years in prison.
Rodriguez also scheduled a bench trial for Ruben Gallegos Sr. on Thursday for Oct. 21. That trial is expected to last one week, court records indicate.
IES was a nonprofit that operated in the Rio Grande Valley, mainly in Cameron County, that contracted with the federal government under the Unaccompanied Alien Children care and placement program to provide placement, housing, food and other services to children with no lawful immigration status who do not have parents or legal guardians here to take care of them.
The program is administered by the Office of Refugee Resettlement, or ORR, under the Administration for Children and Families, or ACF, within the U.S. Department of Health and Human Services, or HHS.
The charges against the Gallegos concern their activities between 2014 and 2018 when IES received millions of dollars in federal grant funds.
A 2016 audit of IES’ fiscal year 2015 found that the Gallegos’ and Gonzalez violated executive compensation limits and committed less-than-arm’s-length transactions in violation of federal limits.
They are accused of grossly overpaying themselves salaries inflated well above set salary caps required by the grants and Gonzalez has said in court documents that it was Ruben Gallegos Sr.’s idea to increase executive salaries.
Federal prosecutors also allege all three men enriched themselves by leasing buildings linked to them to IES and overcharging the nonprofit rent.
IES operated for years before abruptly shutting down and firing all of its employees on March 31, 2018.
