David Whitaker, founder of the cybersecurity company whose contracts with the V.I. Police Department became the focus of an FBI investigation, admitted to two counts of wire fraud and one count of bribery concerning programs receiving federal funds in a plea deal with prosecutors unsealed on Thursday in V.I. District Court.
Whitaker — the former owner of Mon Ethos Pro Support who has a long history of fraud but nonetheless was able to secure more than $3 million in V.I. government contracts — was released on an unsecured $250,000 bond. He surrendered his passport and was ordered not to travel outside of Georgia, where he currently lives, except to visit his father in Coeburn, Virginia, or to attend court hearings in the U.S. Virgin Islands.
The FBI investigation came to light in June, when agents seized the cell phones of then VIPD Commissioner Ray Martinez and Office of Management and Budget Director Jenifer O’Neal, who was subpoenaed to testify regarding the VIPD contract with Whitaker, the FBI and U.S. Attorney’s Office said at the time. Both Martinez and O’Neal resigned.
In a phone call Thursday night, FBI Special Agent and Public Affairs Officer Limary Cruz-Rubio declined to comment on specific cases but hinted at future developments. When asked about the possibility of more arrests, she stated, “You can rest assured that for any violations under our purview, there will be arrests on the horizon. The FBI takes seriously its duty.”
According to the partially redacted plea agreement, Whitaker’s bribery charge concerns money and favors he gave to a VIPD official identified as “Public Official One” in return for payment of outstanding invoices under his cybersecurity contracts with the department.
One wire fraud charge stems from 12 surveillance devices Whitaker claimed to have found in V.I. government offices in a sweep he was hired to conduct in 2022 after a miniature spy camera was discovered at the Division of Personnel. In fact he had planted them, according to the plea deal. He then billed the VIPD $130,195.10 for his “work.”
The other wire fraud count relates to false statements Whitaker made to the Small Business Administration to secure a potentially forgivable Paycheck Protection Program loan for $469,903 in February 2021, it said. The PPP was meant to help small businesses keep their workforces employed during the COVID-19 pandemic.
The wire fraud is because in the first instance, Whitaker transferred money from his endeavor to his bank account in Puerto Rico through New York, and in the second, submitted his PPP loan application from a computer in the Virgin Islands through servers based in Oregon.
A pre-sentence investigation is underway, and a sentencing date has not been set. However, according to the plea agreement, the bribery count carries a maximum of 10 years in prison and the wire fraud charges up to 20 years behind bars. Each charge also carries a $250,000 fine. Whitaker also could have to pay the government anywhere from $196,195 to a maximum of $666,098 if it is unable to recover the proceeds of his crimes, the deal states.
Given his background, it remains unclear how Whitaker was able to secure numerous government contracts, including for handling sensitive information relating to important VIPD cases.
In 2008 he was nabbed in Mexico and returned to the United States to face a multicount fraud complaint of bilking customers out of more than $10 million by selling, but never delivering, electronic equipment. While on the lam south of the border, he allegedly made millions of dollars by selling black-market steroids and human growth hormones online. Facing 65 years behind bars on the fraud charges, Whitaker became an FBI operative in a sting that eventually saw Google fined $500 million for its role in facilitating online illegal drug sales. Whitaker subsequently got five years on the fraud charges.
According to an expose of his escapades by Wired magazine in May 2013 that called him a “career conman,” Whitaker has been in and out of jail since he was first arrested for bank fraud and e-racketeering in 1997 when he was 22.
“Every time he left prison, Whitaker would go right back to his usual patterns, which were only enabled by the chaotic spread of ecommerce. He could create a company almost as quickly as he could think of it, and he never had to meet customers face-to-face. He started printing businesses, telecommunications companies, auto resellers,” the magazine wrote.
Whitaker also faces numerous lawsuits brought by people in the USVI — for failing to pay rent, legal fees, salaries, and promised returns for investing in Mon Ethos, among other complaints — and the mainland U.S. In many cases, he responds to lawsuits with countersuits that can tie up the litigation for years.
That’s exactly what happened with the VIPD contract for cybersecurity services, which ended with the government suing for the return of its equipment, alleging that Whitaker was holding it “hostage” and threatening to delete sensitive data unless Mon Ethos was paid $479,795 it said it was owed. The case was recently settled and dismissed, only to be reopened when Whitaker filed a motion for costs and attorney fees, calling the complaint against Mon Ethos frivolous. The government has until Tuesday to respond.
According to the plea deal, Whitaker made further inroads with the VIPD beginning around November 2022 and continuing until about September 2023 by paying bribes to a person whose name is redacted, who then “caused the payment of outstanding invoices, and caused additional contracts to be awarded to the Defendant with the VIPD.”
The bribes included financial assistance to a restaurant owned by a person whose name is redacted, in return for making sure Mon Ethos’s outstanding VIPD invoices would be paid. In all, Whitaker provided at least $66,000 worth of bribes, including the purchase of restaurant supplies and equipment, trips from St. Thomas to Boston, and payment of cash to the person’s family, the agreement states.
“The expenses associated with the Boston trips included, but were not limited to, staying at the Encore Hotel, personal butler service throughout the stay, and tickets to local sporting events,” it says.
Whitaker is represented by attorney David J. Cattie, who declined to comment on Thursday. The Source also reached out to former VIPD Commissioner Martinez but did not receive a reply.
The case has been reassigned, from V.I. District Court Chief Judge Robert Molloy to Third Circuit Judge Mark A. Kearney of Philadelphia, which is not unusual in matters concerning the territorial government and its agencies.
