WACO, Texas – A Killeen couple has admitted to conducting a multi-million-dollar scheme to defraud the U.S. Army with respect to a Mass Transportation Benefit Program at Fort Hood.
42-year-old Kevin Romulus Pelayo and 37-year-old Cristine Furio Fredericks appeared before U.S. Magistrate Judge Jeffrey C. Manske, and pleaded guilty to two counts of engaging in monetary transactions with criminally derived property. Pelayo also pleaded guilty to one count of conspiracy to commit wire fraud.
By pleading guilty, Pelayo and Fredericks admitted that from January 2014 to June 2020, they provided false documentation regarding their ride-share program on Fort Hood called Soldiers Vanpools, LLC, including names and other personal information of over 1,000 unsuspecting active-duty soldiers, in order to fraudulently collect Department of Transportation Mass Transportation Benefit Program funds.
U.S. Attorney Ashley C. Hoff; Special Agent in Charge Ray Rayos, Southwestern Fraud Field Office of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (Army CIC-MPFU); and Special Agent in Charge Richard D. Goss of the IRS Criminal Investigation’s Houston Field Office made this announcement on Tuesday.
The defendants face up to ten years in federal prison for each money laundering charge. Pelayo faces up to 20 years in federal prison for the conspiracy charge.
The defendants have agreed to forfeit to the government proceeds of their fraudulent scheme to include a dozen real estate properties in Killeen, Harker Heights, Copperas Cove and Kempner; 43 automobiles, SUVs, ATVs and a 5th-wheel trailer; over 120 designer tote bags, handbags and wallets; and, over $600,000 in cash. Sentencing has yet to be scheduled.
The Army CIC-MPFU’s Southwestern Fraud Field Office and IRS Criminal Investigation are conducting this ongoing investigation with valuable assistance from the Texas Department of Public Safety’s Criminal Investigations Division. Assistant U.S. Attorneys Greg Gloff and Robert Almonte are prosecuting this case.
Source: U.S. Department of Justice