Ken Paxton

Tuesday, December 20, 2005

Attorney General Abbott Obtains Second Guilty Plea In Ercot Organized Crime Case

GEORGETOWN - Texas Attorney General Greg Abbott today obtained the second guilty plea from a defendant named along with five others in indictments last January who ran an organized crime ring inside the Electric Reliability Council of Texas (ERCOT) in Williamson County.

John Cavazos, 33, of San Antonio pleaded guilty to misapplication of fiduciary property enhanced to organized criminal activity, a third-degree felony. He returned $8,700 to ERCOT, which is the amount he was illegally paid as a security contractor. His sentencing is set for March 31.

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John Cavazos

We are gradually peeling back the layers of this sophisticated ring and exposing these individuals for who they are white collar criminals, said Attorney General Abbott. I look forward to getting the remainder of the players in front of a jury and seeing that justice is done.

Cavazos, who was not employed by ERCOT, agreed to act as president of a shell security company established by some of the other defendants, who were upper-level employees of the state’s electricity grid system. As president, Cavazos helped conceal the identities of the other defendants involved in the scheme. The enrichment scheme was designed to violate ERCOT’s strict conflict-of-interest policy prohibiting employees from profiting in any manner from ERCOT’s business decisions.

Cavazos’s Tri-Force Security Inc. was one of several papercompanies hatched by the defendants to conceal the identities of the players while allowing them to profit in the range of $2 million.

James Christopher Uranga, 37, of Round Rock, was an upper level security manager within ERCOT who schemed to funnel contract payments to the defendants’ illegal security and information technology companies. He pleaded guilty in August to misapplication of funds and admitted he owes ERCOT $500,000 for illegal profits he obtained. He awaits sentencing in January.

Other former ERCOT employees still awaiting trial are Kenneth Shoquist, Steve Wallace and Carlos Luquis. Some of the group’s activities are under investigation by the Travis County District Attorney’s Office. One other defendant, Chris Douglas is currently cooperating with the Attorney General’s prosecutors.

The integrity of ERCOT, the state’s electricity grid system, was never compromised because of the organized crime perpetrated. ERCOT is funded through a charge of 42 cents per 1,000 kilowatts, which equates to about 50 cents per month on a residential bill.