A former U.S. Navy chief petty officer, now living in Georgia, has pleaded guilty to being the ringleader in a $2 million scheme that claimed unusual injuries to defraud a military disability program administered by The Prudential.
Christopher Toups, 43, of Woodstock, Georgia, faces sentencing in February. He could see as much as 20 years in prison and full restitution for his role in the fraud that also involved his wife, a Navy nurse; a Navy doctor; and six others. Some of the defendants were members of the Navy’s famed ordinance disposal team in Coronado, California, the U.S. Department of Justice said in a statement.
The disability program was known as the Traumatic Servicemembers Group Life Insurance Program, or TSGLI for short, and was administered by Prudential Financial, one of the largest life insurance and retirement benefits companies. The program was created to help service members recover from serious injuries sustained during duty, prosecutors explained.
“Fraudulently filing claims for unearned TSGLI benefits diverts compensation from deserving service members who suffered serious and debilitating injuries while on active duty,” said Rebeccalynn Staples, special agent in charge with the Department of Veterans Affairs’ Office of Inspector General. “Worse yet, this defendant actively recruited others into the scheme to feed his greed for compensation he did not deserve.”
Toups’ guilty plea is the culmination of more than four years of investigation into what the Department of Justice called a “sweeping corruption and insurance fraud scheme.”
Authorities said that from 2012 through 2015, Toups claimed fake injuries and received some $400,000 from the program. He also recruited comrades. His wife, nurse Kelene McGrath, also known as Kelene Meyer, of Jacksonville, Florida, falsified or doctored medical records to support the fake injuries, prosecutors said. Dr. Michael Villarroel, the Navy physician, certified that he had reviewed the records and that the claimants had lost some abilities and needed help, a requirement of the insurance program.
Toups, who at one time was a member of the Navy’s construction unit, known as the SeaBees, received a cut of the benefits provided to the other service members. McGrath and Villarroel received kickbacks, federal authorities said.
McGrath pleaded guilty in 2019. The doctor pleaded not guilty and his case is pending, court records show. Two other defendants have pleaded guilty and have been sentenced.
Some of the purported claims appeared to be far afield from combat injuries. McGrath, for example, claimed she fell from a horse. Another defendant said he fell from a ladder while attending to Christmas lights, according to a report in Military.com. Others claimed injuries from a rappelling accident, a fall down stairs, and a fall from equipment.
Prudential officials could not be reached for comment Tuesday morning. Prosecutors and indictments did not explain how the fraud was discovered. The Naval Criminal Investigative Service and the FBI were involved in the investigation.
Topics Fraud
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