Ayudando Guardians victims get $4.9 million

The U.S. Attorney’s Office in New Mexico announced last week the recent recovery of nearly $5 million to help compensate hundreds of victims of a multi-million dollar criminal fraud scheme in which one of the largest guardianship firms in Albuquerque operated as a “family ATM.”

For over a decade, records show, the top officials of the now-defunct Ayudando Guardians Inc. embezzled more than $11 million from nearly 1,000 vulnerable clients who relied on the firm to help them manage their financial affairs because of disability or special needs. Three of the four convicted in the case are still in prison after pleading guilty in 2019.

But victim restitution has taken years.

“From the outset, we have pursued every possible avenue in close partnership with our federal law enforcement colleagues to ensure victims of this complex scheme are not forgotten,” U.S. Attorney for New Mexico Ryan Ellison said on Friday. “We remain committed to using every available legal tool to achieve justice and restore what was unjustly taken from vulnerable New Mexicans.”

The U.S. Marshals Service in Albuquerque first took control of Ayudando in the summer of 2017, ceasing its operations after the four Ayudando officials were indicted by a federal grand jury on charges of conspiracy, fraud, theft and money laundering.

The nonprofit’s president, Susan Harris; her husband, William Harris; son, Craig Young; and her business partner Sharon Moore tapped client trust accounts to pay for personal celebrity Caribbean cruises, luxury items, sporting events, vehicles and upscale homes, records show.

But so lavish was their spending, there was little for the government to forfeit to repay victims. There was no equity in several of the homes, court records show, and a Tanoan house owned by Harris and her husband had two liens that had to be paid off first.

Yet eight years after the scandal broke, one legitimate expense incurred by the firm has paid off — a “Wrap + Crime” insurance policy “designed to insure, among other things, losses incurred due to theft by Ayudando employees,” according to court records.

The Social Security Administration required that Ayudando maintain such coverage, because the firm provided representative payee services for clients who received monthly federal benefits. The federal payments would go to Ayudando to administer for their clients.

The firm, which opened in 2004 and later expanded to Arizona, also held funds for clients who had received insurance settlements, or other payments. The firm also acted as a court-appointed guardian or conservator for others.

Ayudando’s insurer, Travelers Casualty and Surety Co., denied coverage related to the criminal conduct at Ayudando, so the U.S. Attorney’s Office filed suit in 2022. Government attorneys alleged that Travelers’ denial of the United States’ claim was unfounded and frivolous, and that Travelers misrepresented the coverage afforded, court records state.

After a court-facilitated settlement conference last September, the parties reached a settlement of the United States’ claims, in which Travelers agreed to pay $4.9 million. Another $138,767 was previously made available for victim restitution as the net recovery from forfeited assets, said Tessa DuBerry, of the U.S. Attorney’s Office in New Mexico.

The recovered funds satisfy a portion of the $6.8 million money judgment against Susan Harris, she said.

“We will continue to seek assets to pay restitution in full,” DuBerry told the Journal.

Meanwhile, the U.S. Department of Justice has retained a third-party administrator to assist with disbursing the funds to the 969 victims identified by Senior U.S. District Judge Martha Vázquez of Santa Fe.

She wrote in an order last fall that the defendants “used their position of public trust over their vulnerable clients ... to steal money for their own extravagant use and enjoyment.”

The scheme operated for years until several employees, noticing irregularities in the firm’s operations and client accounts, went to the FBI.

But five years earlier, an accountant for the firm realized that the business was being used as “a family ATM,” according to a prosecutors’ memorandum filed in 2021. But he didn’t alert authorities after signing an agreement with an attorney for Ayudando.

Susan Harris, considered the architect of the scheme and primary owner, is serving a 47-year prison sentence in Alabama. She is 78.

William S. Harris, who worked as a guardian, received a 15-year prison sentence. Moore, former chief financial officer and 5% owner, was sentenced to 20 years in prison. Young was sentenced to 71 months in federal prison and is no longer listed as a federal inmate on the Bureau of Prisons website.

The case took a twist in March 2020 when Susan Harris and her husband fled New Mexico after pleading guilty. When they were captured weeks later in Shawnee, Oklahoma, the couple was living under assumed names with their pet Chihuahua. They had just $400 in their possession.