U.S. Army Financial Counselor Admits Defrauding Gold Star Families (2024)

TRENTON, N.J. – A Monmouth County, New Jersey, financial counselor with the United States Army and major in the U.S. Army Reserves today admitted defrauding Gold Star families and related crimes, U.S. Attorney Philip R. Sellinger announced.

Caz Craffy, aka “Carz Craffey,” 41, of Colts Neck, New Jersey, pleaded guilty before U.S. District Judge Georgette Castner in Trenton federal court to the indictment filed against him, which charged six counts of wire fraud and one count each of securities fraud, making false statements in a loan application, committing acts affecting a personal financial interest, and making false statements to a federal agency.

“Those who target and steal from the families of fallen American servicemembers will be held accountable for their crimes,” Attorney General Merrick B. Garland said. “Nothing can undo the enormous loss that Gold Star families have suffered, but the Justice Department is committed to doing everything in our power to protect them from further harm.”

“Caz Craffyadmitted today that he brazenly took advantage of his role as an Army financial counselor to prey upon families of our fallen service members, at their most vulnerable moment, using lies and deception. These Gold Star families have laid the dearest sacrifice on the altar of freedom. And they deserve our utmost respect and compassion, as well as some small measure of financial security from a grateful nation. We will use every means at our disposal to ensure that those who defraud our military families are held accountable. Caz Craffy now faces the prospect of years in prison for ripping off these families to line his own pocket."

“Those who prey on the family members of fallen soldiers, will be sought out and held accountable,” Special Agent in Charge Joel Kirch, Department of the Army Criminal Investigation Division, Northeast Field Office, said. “The hard work, long hours, and dedication of our partners within the Task Force, from the United States Attorney’s Office, Defense Criminal Investigative Service, FBI, Homeland Security Investigations, and our own investigative analyst, resulted in this investigation’s swift resolution.”

“The families of service members who lost their lives while serving their country deserve to be treated with compassion, dignity and respect by individuals entrusted to assist them in obtaining survivor benefits,” said James R. Ives, Principal Deputy Director of the Defense Criminal Investigative Service, the law enforcement arm of the DoD Office of Inspector General. “Today’s announcement reflects DCIS and our law enforcement partners’ steadfast commitment to holding accountable those who use their official positions to take advantage of grieving military families.”

“Gold Star families are givenatitleno one would choosebecauseit means they’vepaidthe ultimatesacrificefor this country,” FBI – Newark Special Agent in Charge James E. Dennehy said. “Thesoldier, sailor, marineorairman they loved died duringa time of conflict– defending this nation.They are given money and assistance to help ease the burden that comes with losing their loved one, but no amount of money can replace what they’ve lost. Craffey took advantage of his position and defrauded families already going through a tremendous amount of suffering. He is being held accountable,and his victims are seeing justice prevail.”

“Craffy disgraced his entrusted position to care for our nation’s militaryfamilies when he allegedly took advantage of them during a vulnerable time of grief,” Homeland Security Investigations Newark acting Special Agent in Charge William S. Walker said. “No family, especially our Gold Star families, should have to face further heartache after a loved one’s death by having their financial security ripped out from under them by fraudsters.”

According to documents filed in this case and statements made in court:

When a member of the Armed Services dies during active duty, his or her surviving beneficiary, now a member of a Gold Star family, is entitled to a $100,000 payment and the servicemember’s life insurance of up to $400,000. These payments are disbursed to the beneficiary in a matter of weeks or months following the servicemember’s death. To assist the beneficiaries in this time of need, the military provides a number of services to the servicemember’s family, including the assistance of a financial counselor.

From November 2017 to January 2023, Craffy was a civilian employee of the U.S. Army, working as a financial counselor with the Casualty Assistance Office. He was also a major in the U.S. Army Reserves, where he has been enlisted since 2003. Craffy was responsible for providing general financial education to the surviving beneficiaries. He was prohibited from offering any personal opinions regarding the surviving beneficiary’s benefits decisions. Craffy acknowledged that he was not permitted to participate personally in any government matter in which he had an outside financial interest. However, without telling the Army, Craffy simultaneously maintained outside employment with two separate financial investment firms.

Craffy used his position as an Army financial counselor to identify and target Gold Star families and other military families. He admitted to encouraging the Gold Star families to invest their survivor benefits in investment accounts that he managed in his outside, private employment. Based upon Craffy’s false representations and omissions, the vast majority of the Gold Star families mistakenly believed that Craffy’s management of their money was done on behalf of and with the Army’s authorization.

From May 2018 to November 2022, Craffy obtained more than $9.9 million from Gold Star families to invest in accounts managed by Craffy in his private capacity. Once in control of this money, Craffy repeatedly executed trades, often without the family’s authorization. These unauthorized trades earned Craffy high commissions. During the timeframe of the scheme, the Gold Star family accounts lost more than $3.7 million, while Craffy personally earned more than $1.4 million in commissions, drawn from the family accounts.

The wire fraud and securities fraud charges are each punishable by a maximum of 20 years in prison. The charge of submitting a false statement on a loan application is punishable by a maximum of two years in prison. The charges of acts affecting a personal interest and false statements to a federal agent are each punishable by five years in prison. All counts but the securities fraud count are also punishable by a maximum fine of either $250,000 or twice the gain or loss from the offense, whichever is greatest. The securities fraud count is punishable by a maximum fine of either $5 million or twice the gain or loss from the offense, whichever is greatest. Sentencing is scheduled for Aug. 21, 2024.

The U.S. Securities and Exchange Commission (SEC) has a pending civil complaint against Craffy based on the same and additional conduct. Craffy has been permanently prohibited from association with any member of the Financial Industry Regulatory Authority Inc. (FINRA).

U.S. Attorney Sellinger credited special agents of the Department of the Army Criminal Investigation Division, under the direction of Special Agent in Charge Kirch; special agents of DCIS, under the direction of Principal Deputy Director Ives; special agents of the FBI, under the direction of Special Agent in Charge Dennehy; and special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Walker, with the investigation leading to the indictment. He also expressed appreciation for the Securities and Exchange Commission, under the direction of Gurbir S. Grewal, Director, Division of Enforcement, and FINRA, under the direction of Head of Enforcement Bill St. Louis.

The government is represented by Assistant U.S. Attorneys Martha K. Nye of the Criminal Division in Trenton, and Carolyn Silane of the Economic Crimes Unit in Newark.

craffy.indictment.pdf

U.S. Army Financial Counselor Admits Defrauding Gold Star Families (2024)

FAQs

How do you know if you are a Gold Star family? ›

The Gold Star family is one that has experienced a loss of a loved one–an immediate family member – who died as the result of active-duty military service. Those who die in service to their country leave behind parents, siblings, spouses, children and extended families.

What is a military Gold Star family? ›

Gold Star family members are recognized as the immediate family members of service members who have died while serving our nation during conflict. During WWI, families of deployed service members began displaying a service flag with a blue star at their homes to represent their loved ones.

What is the gold star community in the military? ›

A Gold Star Family can display a Gold Star Service Flag for service members who were killed or died, while serving in the Armed Forces, from causes other than dishonorable. The number of gold stars on the flag corresponds to with the number of individuals who were killed or died.

What is the history of Gold Star families for peace? ›

Gold Star Families for Peace (GSFP) is a United States-based organization founded in January 2005 by individuals who lost family members in the Iraq War, and are thus entitled to display a Gold Star. It is considered an offshoot of Military Families Speak Out.

Do gold star families get compensation? ›

Gold Star Family benefits are available to the immediate family members of all fallen servicemembers who died while serving in conflict. These numerous benefits are intended to support those families as they recover financially and emotionally.

What is a blue star family? ›

The families of our all-volunteer military make unprecedented sacrifices these days to serve our country. Blue Star Families was founded by military spouses in 2009 to empower these families to thrive as they serve.

What is a white star family? ›

The White Star designation recognizes families who have lost a service member to suicide, whether they were military or first responders.

What is a blue star mom? ›

A Mother or Stepmother (since the child was of the age of 13) who has a son or daughter who is serving, or has been honorably discharged from the Armed Forces of the United States.

Do gold star families get Tricare? ›

All eligible spouses and children remain eligible for military health care coverage. Surviving spouses remain eligible for TRICARE benefits at active-duty dependent rates for three years from the date of the service member's death.

What to say to a gold star mom? ›

I wish that we could hold you, and love you and thank you. You have given so much; it seems inadequate to only give you this reassurance in return. But on Gold Star Mothers Day, we offer this: your sacrifice is not in vain. Your baby will never be forgotten.

What is a gold star wife in the military? ›

Gold Star Wives of America Inc. provides benefits to surviving military spouses and children to help them face the future with courage and determination. They also exist to honor the memory of those who made the ultimate sacrifice — and to provide aid to surviving spouses and children when necessary.

What is a gold star mom? ›

Gold Star mothers are women entitled to display a gold star on a service flag as the mother, stepmother, adoptive mother or foster mother of a United States Armed Forces member that died while engaged in action against an enemy recognized by the Secretary of Defense.

Where did the Gold Star family come from? ›

The term Gold Star family is a modern reference that comes from the Service Flag. These flags/banners were first flown by families during World War I.

What is gold star criminal mind? ›

Gold stars on the wall represent dead agents, as evidenced when Deputy Director Bailey is added to them. However, Voit could be referring to characters from Criminal Minds who are thought to be dead but are secretly in hiding, with “Gold Star” being a codename for these members of the BAU.

Who is a gold star kid? ›

ABOUT GOLD STAR CHILDREN

Gold Star Children, a not for profit organization, was founded in 2008 to raise awareness about American child survivors whose mothers or fathers were killed or died while serving in the United States military.

What qualifies as a gold star spouse? ›

If a service member died in combat, the blue star was replaced with a gold star, symbolizing the ultimate sacrifice. In 2010, Congress designated April 5th as Gold Star Spouses Day to recognize and honor the spouses of fallen service members.

What are the qualifications to be a gold star mother? ›

From Our Bylaws: Natural Mothers or adoptive mothers, who were citizens or legal residents of the United States or of the Territorial and Insular Possessions of the United States, at the time of their son's or daughter's induction into the United States Armed Forces and whose son or daughter became missing in action, ...

What is the difference between a blue star family and a gold star family? ›

If the military member is active duty, then the family is considered "blue star." If the military member was wounded in action then, the family is considered "silver star," and if the military member was killed in action then the family is considered "gold star."

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