Former Defense Department Employee Pleads Guilty to Defrauding Government in Fake Invoices Scheme

A California woman pleaded guilty today to devising a multi-year scheme to defraud the U.S. government by submitting fake invoices for supplies that were never purchased and converting the stolen funds for her personal use.

According to court documents, Zelene Charles, 42, of Monterey, a then-civilian employee of the Department of Defense, at the Defense Language Institute in Monterey, California, perpetrated a scheme to defraud the U.S. government by creating fake purchase requests and invoices for government purchases from both fictitious and legitimate business entities. The items listed in these invoices were never actually purchased or received by the government. Between December 2016 and April 2020, Charles placed approximately 185 fraudulent charges, causing a total loss to the government of $624,250. To conceal that she was the recipient of the stolen funds, Charles frequently renamed the business names associated with intermediary accounts and, in total, used at least 78 different account names.

Charles pleaded guilty to wire fraud and theft of government money and property. She faces a maximum penalty of 20 years in prison for the wire fraud charge and 10 years in prison for the theft charge. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Charles also agreed to pay $624,500 in restitution and forfeit numerous stolen government computers and tablets as part of her plea.

Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department's Criminal Division; U.S. Attorney Ismail J. Ramsey for the Northern District of California; Special Agent in Charge Bryan Denny of the Defense Criminal Investigative Service (DCIS) Western Field Office; Special Agent in Charge Keith K. Kelly of the Department of the Army Criminal Investigation Division's (Army-CID) Fraud Field Office; Special Agent in Charge Shawn Dionida of the Department of Agriculture Office of Inspector General (USDA-OIG) Western Region; and Special Agent in Charge Terry Pfeifer of the General Services Administration Office of Inspector General (GSA-OIG) Western Division made the announcement.

The DCIS Western Field Office, Army-CID Fraud Field Office, USDA-OIG Western Region, and GSA-OIG Western Division are investigating the case.

Trial Attorney Richard B. Evans of the Criminal Division's Public Integrity Section and Assistant U.S. Attorney Anne C. Hsieh for the Northern District of California are prosecuting the case.