A federal jury has found state Sen. Carlos Uresti of San Antonio guilty of 11 charges, including wire fraud, money laundering and securities fraud related to his involvement with the bankrupt fracking sand company FourWinds Logistics.
Uresti showed no reaction as a court deputy read his 11 guilty verdicts. The state legislator then hugged his family and his attorney. The Democratic senator, who served 21 years in the Texas House and Senate, now faces decades in prison.
Uresti acted as investment broker for FourWinds. Additional guilty verdicts were read against co-defendant Gary Cain, a consultant for FourWinds.
“FourWinds Logistics was essentially set up as a fraudulent scheme to lure investors to put money with the co-conspirators via false pretenses, false promises, misrepresentations including altered financial documents,” said U.S. Attorney John Bash.
The company was set up to buy and sell fracking sand but the government alleged the money was instead used to pay back other investors and fund the lifestyle of FourWinds employees.
“A lot of that money went to personal expenses by the co-conspirators; everything from gifts, and travel, and luxury vehicles, to controlled substances, even prostitutes,” Bash added.
- WATCH | Assistant U.S. Attorney Joe Blackwell
https://www.youtube.com/watch?v=FrbvppL_e7M&feature=youtu.be
Uresti’s role with FourWinds was to bring in investors, and he successfully recruited several individuals to invest hundreds of thousands of dollars in the company. He received portions of that money.
One investor was Denise Cantu. Cantu was Uresti’s former law client. The senator won a settlement for Cantu in an unrelated wrongful death case. A few years later, he encouraged Cantu to invest that money into FourWinds. Cantu would lose over $800,000.
The trial lasted a month. Uresti’s attorneys argued Uresti did not know what the company was doing with its money. Outside the courthouse, Uresti said he does not immediately plan to step down from his Senate seat and will appeal the verdicts.
“It’s not the verdict we were expecting so I’m going to meet with my family and my wife and my attorneys, and we’ll make those decisions down the road.”
Uresti can keep his Senate seat if the case is on appeal, but his law license may be suspended during that time.
Meanwhile. Lt. Gov. Dan Patrick, who presides over the Texas Senate, is stripping Uresti of all Senate committee assignments.
Patrick, in a statement, said while Uresti is entitled to his right to appeal the court’s decision, it was within the lieutenant governor's authority to remove the San Antonio Democrat from all committees, including the Senate’s powerful Education and Finance committees.
Brandon Rottinghaus, political science professor at the University of Houston, believes when Uresti comes back for the 2019 legislative session, this federal conviction might be a huge hurdle.
“So he has at least one more session before he is up for re-election and that’s going to be a session that is going to difficult for him to get things done,” Rottinghaus said. “Because as it is carrying bills and pushing a policy agenda is going to be difficult when people don’t think you will be back for the next term.”
Gilberto Hinojosa, the Texas Democratic state party chair, felt Uresti’s federal jury trial was a fair process.
“As a lawyer and a judge for almost 40 years, I have complete confidence in our system of justice and I’m saddened that this has happened to this man, but we’ve got to move on and allow the system to work the way it was intended to,” Hinojosa said.
Hinojosa would not say whether he felt Uresti should step down, and among the San Antonio Democrat’s Senate colleagues there was a similar sentiment, most of who declined to comment on the matter.
Uresti has said he has no intention of immediately leaving office and there is no state law that would prevent him from serving out the remainder of that term during appeal process.
Sentencing is scheduled for June. The senator also faces indictments in an unrelated federal bribery case expected to start in May.
Joey Palacios can be reached at Joey@TPR.org and on Twitter at @Joeycules. Ryan Poppe can be reached at Rpoppe@TPR.org and on Twitter at @RyanPoppe1
