Stephanie Barnes, a former Casino Control Commission contractor serving 44 months in prison for stealing from the government, should have her sentence vacated because the V.I. District Court lacked jurisdiction to hear the case, according to an appeal filed Monday in the Third Circuit Court of Appeals.
Barnes was found guilty by a jury in December 2021 in V.I. District Court on St. Croix of theft or bribery concerning programs receiving federal funds under 18 U.S. Code, Section 666. She also was convicted of two charges under the V.I. Code — filing a false tax return and receipt of government property.
However, her appeal asserts that the federal charge should never have been brought because “no federal interest warranted the federal government’s intervention,” given that the Casino Control Commission is an independent entity that was created by an act of the Legislature in 1995, separate from the V.I. government, and received no federal program benefits.
The commission’s “revenue originates from private sources and its operational account is held and administered autonomously. The Commission’s chairperson is an ‘agent’ of the Commission, not of the V.I. Government. The funds purportedly misapplied/converted were under the ‘custody, care and control’ of the Commission, not of the V.I. Government. Only the Commission was a party in Barnes’ contract. The evidence did not support § 666’s jurisdictional element,” the appeal states.
Moreover, because the District Court “lacked subject matter jurisdiction from the inception in regards to Count 5 [the federal charge], it lacked concurrent jurisdiction over the local offenses. Pursuant to the Organic Act of 1954, the district court may have had concurrent jurisdiction over Counts 23 and 30 [the local charges] only if the district court had jurisdiction over a federal offense. It did not in this case. Counts 23 and 30 thus failed as well,” according to the appeal.
Barnes first sought to have her case dismissed for lack of jurisdiction in December 2019, but Judge Robert A. Molloy denied her motions without prejudice in an order issued one year later, in December 2020.
That was a mistake, according to the appeal, which spans 64 pages plus 268 pages of exhibits.
The Justice Department’s theory was that the V.I. government received federal benefits and that the Casino Control chairperson was an agent of that government, it says. However, what the evidence showed is that the commission is “an entity totally independent from the V.I. Government, which did not receive any funding from the V.I. Government, let alone from the federal government, and which generated and autonomously administered its own operational revenue.”
Moreover, the court failed to properly instruct the jury regarding the theft of federal funds charge, which requires that the organization, government or agency must have been unanimously found to have received benefits in excess of $10,000 under a federal program in the same one-year period. Because Barnes’ crimes are alleged to have spanned 2.5 years, the “missing unanimity instruction most likely led the jury to not consider the same one-year period to find beyond reasonable doubt that an agreement to violate § 666 was reached. The general unanimity instruction was insufficient,” according to the appeal.
Barnes, 65, is currently incarcerated at the John A. Bell Adult Correctional Facility on St. Croix after being moved in April from the Metropolitan Detention Center in Guaynabo, Puerto Rico, where she had been held since her conviction.
She has steadfastly maintained her innocence and has alleged that any fraud or theft that took place was the work of Violet Anne Golden, the former head of the Casino Control Commission, who pleaded guilty to misappropriating $295,503 of government funds in January 2020. Under her plea deal, Golden was sentenced to 24 months behind bars in August that year and was released in September 2021. She testified at Barnes’ trial on behalf of the prosecution.
According to court records, Golden and Barnes spent the money intended for agency operations on lavish trips, clothing, entertainment, and other unapproved items after Golden hired Barnes in 2015 to develop programs for people with gambling addictions.
The U.S. Attorney’s Office said the expenditures included a chartered plane and VIP passes to the St. Kitts Music Festival, travel to casino-related conferences “so as to enjoy luxurious hotel stays with meals and room service at high-end places such as the Ritz Carlton Hotel,” excursions to Disney World in Florida and to see “Hamilton” on Broadway in New York.
“All told, the evidence established that Barnes received salary and benefits from the Casino Commission totaling over $600,000 in approximately three years,” the U.S. Attorney’s Office said.
The irregularities in spending and administrative functions were brought to light by an investigation of the V.I. Inspector General in 2018, which led to a referral to the FBI. Golden and Barnes were indicted on July 11, 2019, and arrested one week later.
However, Barnes alleged that not only did Golden operate without any oversight by her fellow commissioners and employees, but she had also been doing so since 2013 when she became chairwoman — two years before Barnes was hired.
Barnes is represented in her appeal by Kendys Pimentel-Soto of Puerto Rico, who was appointed by court order in August. Assistant U.S. Attorney Adam Sleeper is representing the government.
