Assistant U. S. Attorneys Andrew P. Young (619) 546-7981 and Emily W. Allen (619) 546-9738
NEWS RELEASE SUMMARY - May 2, 2018
SAN DIEGO - The United States unsealed an indictment today that charges U. S. Navy service members Christopher Toups, Jason Toups, Kelene McGrath, Ernest Thompson, and Richard Cote with fraud, false claims and conspiracy to defraud the United States. The charges arise from a scheme wherein the defendants filed fraudulent claims to obtain unearned benefits from the Traumatic Servicemembers Group Life Insurance Program (“TSGLI").
According to the indictment, the TSGLI program is an insurance program that compensates service members who suffer serious and debilitating injuries while on active duty. The program is funded by fees paid directly by individual service members and the Department. The five defendants, four former and one active members of the United States Navy, each fraudulently claimed that they were entitled to benefits of $100,000 for serious injuries they claimed to have suffered-but which in fact never occurred. To support their applications, each defendant submitted fabricated applications that included forged signatures and altered hospital records. Four of the five defendants received the $100,000 payouts before the government uncovered the scheme and froze the final payment.
“The TSGLI program is designed to protect hundreds of thousands of honest and hard-working service members. This indictment sends a message to those who seek to defraud the government out of the dollars meant to care for our seriously injured military members that they will be held accountable," said U.S. Attorney Adam L. Braverman.
Defendants Jason Toups, Kelene McGrath, Ernest Thompson and Richard Cote were arraigned on the indictment before U.S. Magistrate Judge Ruben B. Brooks. Christopher Toups is expected to make his initial appearance before a federal judge in Georgia. Their next court appearance is scheduled for June 1 at 1:30 p.m. before Judge U.S. District Judge Janis L. Sammartino.
DEFENDANTS Case Number 18cr1674-JLS
Richard Cote Age: 43 Oceanside, CA
Kelene McGrath Age: 41 Jacksonville, FL
Christopher Toups Age: 40 Woodstock, GA
Jason Toups Age: 35 Gulfport, MS
Earnest Thompson Age: 44 Murrieta, CA
SUMMARY OF CHARGES
Count 1:
Conspiracy to Commit Wire Fraud - Title 18, U.S.C § 1349
Maximum penalty: 20 years’ imprisonment and fine of higher of $250,000 or double loss amount
Counts 2-7:
Wire Fraud - Title 18, U.S.C § 1343
Maximum penalty: 20 years’ imprisonment and fine of higher of $250,000 or double loss amount
Counts 8-12
Making a Fraudulent and False Claim - Title 18, U.S.C § 287
Maximum penalty: Five years in prison and fine of higher of $250,000 or double loss amount
AGENCIES
Naval Criminal Investigative Service
Federal Bureau of Investigation
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Source: U.S. Department of Justice, Office of the United States Attorneys
