SAIPAN, CNMI – SHAWN N. ANDERSON, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that on May 6, 2026, the Honorable Ramona V. Manglona sentenced a mother and her daughter in the United States District Court for the Northern Mariana Islands for their roles in a procurement fraud and money laundering scheme targeting the CNMI Public School System (PSS), a recipient of Federal grant money.
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Clarissa Adlawan, age 55, a lawful permanent resident of the United States originally from the Philippines, was sentenced to 48 months imprisonment for one count of Conspiracy to Commit an Offense Against the United States, in violation of 18 U.S.C. § 371, and one count of Money Laundering Conspiracy, in violation of 18 U.S.C. § 1956(h). The Court also ordered her to serve three years of supervised release and complete 100 hours of community service.
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Giselle Butalid, age 34, a naturalized U.S. citizen originally from the Republic of the Philippines and a resident of Saipan, was sentenced to 18 months imprisonment for one count of Conspiracy to Commit an Offense Against the United States, in violation of 18 U.S.C. § 371, and one count of Money Laundering Conspiracy, in violation of 18 U.S.C. § 1956(h). The Court also imposed three years of supervised release and ordered her to complete 100 hours of community service.
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The Court further ordered that the defendants were jointly and severally liable for restitution in the amount of $548,788 and that two properties they owned in the Philippines were subject to forfeiture.
The conspiracy involved theft from a state entity receiving more than $10,000 per year in federal funding, a violation of 18 U.S.C. § 666(a)(1)(A) when charged individually. PSS was such an entity. Butalid worked for PSS and had access to its procurement process. She used that position to betray the trust of those responsible for educating the CNMI’s children, depriving those children of desperately needed resources while enriching herself and her mother.
The prosecution commended the defendants’ early acceptance of responsibility and expressions of remorse but argued Adlawan had failed to provide information about a nine room house she had built in the Philippines. Evidence established that Adlawan used PSS’s stolen money for the house’s construction. Adlawan’s plea agreement required her to provide information and help the Government acquire the property so it could be liquidated and the proceeds applied toward restitution. The Court agreed and denied Adlawan the benefit of accepting responsibility.
According to court documents, from October 2021 through August 2022, Butalid and Adlawan used their company, One Legacy LLC, to sell educational material while concealing the conflict of interest from PSS. Investigators then determined that Butalid forged documents to conceal that several of procurements were in fact “ghost” purchases. The defendants simply pocketed payments for materials that PSS never ordered. Upon receiving funds, the defendants frequently traveled to the Philippines, staying in luxury hotels, withdrawing large amounts of cash, and building the aforementioned house.
Examples cited in Court documents include:
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Payments of $50,000 and $52,500 to One Legacy for online learning materials that were never procured. Shortly after the payments, Butalid and Adlawan flew to the Philippines and withdrew approximately $10,000 in cash from ATMs.
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A $113,020 payment for another fraudulent purchase, followed by cash withdrawals totaling roughly $65,000 before another overseas trip. This final payment came shortly after PSS confronted Butalid about her connection to the companies. She resigned but remained long enough to commit this one last act of fraud, according to prosecutors.
“The defendants’ conduct went beyond defrauding government agencies,” stated United States Attorney Anderson. “Ultimately, children were deprived of educational resources and opportunities to learn. Any sense of justice required terms of imprisonment. We will continue to seek accountability through the repatriation of any foreign assets held by these defendants. Our interagency partners did outstanding work in investigating this complex financial crime to combat the fraud, waste, and abuse of taxpayer funds.”
“Cases like this one clearly demonstrate the destructiveness of greed: funds that would have otherwise been used for the benefit of our communities’ children instead went to finance the dream house of a fraudster,” said Special Agent in Charge Carrie Nordyke, IRS Criminal Investigation (IRS-CI), Seattle Field Office. “Defrauding the government may seem harmless, but as this case so clearly shows, these crimes have direct, severe, and negative impacts on our community. Today’s sentencings are a continued reminder that justice will be served on those who choose their greed above all else.”
“This sentencing represents the culmination of a significant effort by a dedicated team of exceptional investigators. I am particularly proud that U.S. federal agencies conducted this investigation in partnership with the CNMI Office of the Public Auditor,” said David A. House, Special Agent in Charge for the Department of Interior Inspector General, Program Fraud Unit. “This collaboration underscores the strength of our partnership and our shared commitment to ensuring that funds intended for the schoolchildren of the CNMI are used appropriately, and that anyone who misuses those funds is held fully accountable, regardless of their location.”
“The defendants’ actions represent a profound betrayal of the students, teachers, and community who relied on them for honest public service,” said FBI Honolulu Special Agent in Charge David Porter. “These individuals exploited that trust for their own enrichment. Today’s outcome demonstrates that those who choose greed over their commitment to serve the community will be brought to justice.”
“We value the strong working relationship between the Office of the Public Auditor and our federal counterparts, “said the CNMI Office of the Public Auditor. “The success in this case demonstrates what can be accomplished through coordinated oversight, teamwork, and a shared commitment to protecting public resources and ensuring accountability.”
The investigation was conducted by IRS–Criminal Investigation, Office of the Inspector General – Department of Interior, Federal Bureau of Investigation, and the Commonwealth of the Northern Mariana Islands Office of the Public Auditor.
The case was prosecuted by Assistant United States Attorney Eric S. O’Malley for the District of the Northern Mariana Islands.
On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division. The core mission of the Fraud Division is to zealously investigate and prosecute those who steal or fraudulently misuse taxpayer dollars. Department of Justice efforts to combat fraud support President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.