A former administrator for Hidalgo County EMS took nearly $195,000 from the struggling company, according to documents filed in federal bankruptcy court.
Edgar Diaz — an administrator for Hidalgo County EMS, a privately owned ambulance company that declared bankruptcy and shut down last year — admitted in a settlement agreement that he misappropriated the money.
“Beginning as early as January 2018, Diaz appropriated funds without written consent from the Debtor,” according to a settlement agreement filed with the bankruptcy court. “The total amount of the appropriated funds taken by Diaz is $194,972.04.”
U.S. Bankruptcy Judge David R. Jones approved the settlement agreement on Jan. 27.
Diaz declined to comment. The bankruptcy trustee, attorney Christopher R. Murray of Houston-based law firm Jones Murray & Beatty, didn’t respond to a request for comment.
When, exactly, Hidalgo County EMS discovered that Diaz had taken money without permission remains unclear.
“Mr. Diaz was terminated because he confessed to stealing from the company,” former Chief Restructuring Officer Omar Romero wrote in response to a discovery request. “I personally recused myself from that issue as soon as I learned of it because of my long personal and family connection with Diaz.”
Hidalgo County EMS filed a report with the McAllen Police Department in March 2021. Diaz, though, was never arrested or charged with any crime.
In November 2021, nine months after Hidalgo County EMS filed the police report, Diaz signed a settlement agreement with the bankruptcy trustee.
Diaz agreed to pay back the money within two years. In exchange, the bankruptcy trustee agreed to abandon “all causes of action” against him.
The agreement is guaranteed by Diaz’s mother.
If he fails to make the payments, the bankruptcy trustee may seize a commercial building she owns. The property, which is located on the 2500 block of Buddy Owens Boulevard in McAllen, is worth $226,000, according to information published by the Hidalgo County Appraisal District.
Diaz wasn’t the only person accused of taking money from Hidalgo County EMS without permission.
Two other top administrators, Romero and CEO Kenneth B. Ponce, pleaded guilty to bankruptcy fraud charges last year.
Ponce confessed to falsifying documents, concealing assets and defrauding creditors during the bankruptcy. Among other things, Ponce falsified documents to protect McAllen businessman Jose Luis Trejo, who had loaned him hundreds of thousands of dollars.
The criminal information against Ponce identified Trejo as “Co-Conspirator A.”
“The fraudulent instruments were then relied upon during the course of the bankruptcy proceeding which allowed Co-Conspirator A to gain preferential treatment over other Hidalgo County EMS creditors,” according to the criminal information.
As part of his plea, Ponce agreed to pay back about $124,000.
Romero, meanwhile, confessed to improperly taking $50,000 from Hidalgo County EMS. The criminal information against Ponce identified Romero as “Co-Conspirator B.”
“During the course of the bankruptcy proceeding, Co-conspirator B obtained at least $50,000.00 from the bankruptcy estate that was not authorized as his compensation,” according to the criminal information. “PONCE accepted an interest payment from Co-Conspirator B on the funds taken from the Hidalgo County EMS bankruptcy estate.”
Romero agreed to repay $50,000.