The Padres met a prospect they liked in the Dominican Republic. At 16, the kid showed enough skills that they figured he would mature into a pretty good major league ball player. Enough that they sign him to a $1 million bonus.
Turns out the player is actually 19 and probably would not have been deserving of the $1 million bonus.
Turns out that in order for this prospect to claim that he was 16, he had to falsify his identity and use a fake name.
Turns out that he used this fake name to gain permission for entry into the United States.
Now... Put yourself in the shoes of this kid. Likely he grew up poor. Likely he's been playing baseball all his life with an eye towards the major leagues because that's the dream of young players in the Dominican. At 19, if you haven't been noticed, you're close to a non-prospect. All he has to do is say that he's 16. If he says he's 16, he gets a million dollars. Otherwise, he just gets compared to the other over the hill 19 year olds.
So the reality of the situation is this kid thinks he's telling a lie, which he knows has been told over and over and over again throughout the history of baseball (I'm looking at you Miguele Tejada, Satchel Paige, Deivi Cruz...). He sees that he's now in the position to tell the same lie and become potentially an all-star, a hall of famer or at least a bench player making league minimum, which sets him up for life in the Dominican. He tells this lie and gets caught.
Sucks for him.
Embarrassing for the Padres (who thankfully have an insurance policy on this sort of thing because it happens ALL THE TIME).
Hardly cause for jail times, which is what some of the SignOnSanDiego commenters would have you believe. Probably not very nice to compare him to a terrorist. This is one of the issues with international recruiting that you have to be aware of. The Padres were aware that this might happen and they got most of their money back on the deal. Now the impetus is on Jorge Leandro Guzman aka Alvaro Aristy to prove that he still deserves to be a Major League ballplayer.