GALVESTON — The principal owner of Flagship Hotel Ltd. has pleaded guilty to filing a false claim with the Federal Emergency Management Agency’s Short Term Lodging Program, U.S. Attorney Don DeGabrielle said Friday.
DeGabrielle said Daniel Yeh, 54, pleaded guilty to filing a false claim with the government during a hearing before U.S. Magistrate Judge John Froeschner.
Yeh faces a maximum punishment of five years in prison without parole and a fine of up to $250,000 at sentencing. Froeschner set Yeh’s sentencing for Feb. 1.
FEMA created the Short Term Lodging Program to provide free hotel rooms to Hurricane Katrina and Rita evacuees.
The investigation into the Flagship for fraudulent billing began when federal agents received a tip stating hotel records showed full occupancy when many rooms were vacant.
Agents with a search warrant went to the hotel and Yeh’s home in December 2005. Within days, Yeh returned $232,000 to the government based on his calculations of the number of rooms he had charged to FEMA in the names of friends, relatives and hotel employees.
In 2006, Yeh, who had undergone surgery to remove tumors from his brain, was ruled incompetent to stand trial. He was committed to the Federal Medical Facility at Butner, N.C., where doctors found he was competent to stand trial.
