A Honduran man who resided in St. Tammany Parish has pleaded guilty to federal charges in a conspiracy to launder $1.3 million in foreign bribes and public funds from the Republic of Honduras, some of which was then used to purchase real estate, authorities said.
The U.S. Department of Justice said Thursday (June 28) that Carlos Zelaya, 47, pleaded guilty in federal court in New Orleans to one count of conspiracy to commit money laundering. U.S. District Judge Martin C. Feldman set sentencing for Oct. 3.
In addition to Honduran corruption, the case also has connections to a former St. Tammany Parish resident whose family was once the victim of a home invasion.
The federal government accused Zelaya of conspiring with his brother, Mario Roberto Zelaya, the former executive director of the Honduran Institute for Social Security, in taking $1.3 million in bribe money and using it to purchase nine properties in St. Tammany. Carlos Zelaya owned C&M Motors in Covington and with his brother owned C&M Wholesalers, government filings said.
Mario Zelaya was indicted by the Honduran government in 2014 on bribery and money-laundering charges. He was arrested in Honduras that year after spending seven months as a fugitive, NOLA.com | The Times-Picayune has previously reported.
Mario Zelaya, an orthopedic surgeon, also resided in the Covington area at one time. In May 2013, masked men tied up and terrorized Mario Zelaya’s family in their Covington-area home before stealing money, guns, jewelry and a 2011 Mercedes-Benz.
Mario Zelaya joined St. Tammany law enforcement authorities and Crimestoppers officials for a news conference to announce a reward in the case. Four St. Tammany Parish men were eventually convicted in the case.
Mario Zelaya was head of the Honduran Institute for Social Security from 2010-2014, the government had said previously. Prosecutors accused him of taking bribes from a social security institute contractor. In 2015, a U.S. government complaint against him sought the forfeiture of nine properties in Covington and Mandeville worth more than $1.5 million.
Prosecutors also said Carlos Zelaya collected and spent rental income from the properties while under court order to preserve the funds until the resolution of a civil forfeiture suit, the Justice Department said.
The nine properties are to be forfeited as part of Carlos Zelaya’s guilty plea, the Justice Department’s news release said.