Former Military Financial Counselor Admits to Defrauding Bereaved Military Families (Insurance Business)

Former Military Financial Counselor Admits to Defrauding Bereaved Military Families

  Tuesday, April 23rd, 2024 Source: Insurance Business

In a significant legal development, a former Army financial counselor has pled guilty to charges of life insurance fraud, specifically targeting families of deceased soldiers. The plea, entered in federal court, acknowledges his role in a fraudulent scheme that siphoned millions of dollars from life insurance benefits intended for the families of fallen servicemembers.

The counselor, from Colts Neck, New Jersey, exploited his trusted position to steer grieving families towards high-risk investments through a brokerage firm where he also worked part-time. Over a span of four years, he managed the financial affairs of approximately two dozen families, resulting in a combined loss of $3.7 million. His fraudulent activities yielded him about $1.4 million in commissions.

Charged with multiple counts of wire and securities fraud, the counselor now faces eight to ten years in prison according to his plea agreement, with his sentencing set for August. The case also highlighted a critical lapse in oversight, prompting Congress to enact stricter regulations for vetting military financial counselors following an investigative report.

Victims of the fraud, deeply affected by the counselor’s actions, have expressed dissatisfaction with the plea deal, emphasizing the irreversible impact on their financial security and emotional well-being. The case is not only a judicial matter but also a significant point of concern for military administration, as the Army reviews its procedures to prevent such abuses in the future.

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