New Bedford Man Pleads Guilty to Stealing Over $450,000 in Veterans Disability Funds

Press Release

Benefits were intended for a 20-year Marine veteran with ALS

BOSTON - A New Bedford man pleaded guilty today to stealing over $450,000 in disability benefits issued by the United States Veterans Benefits Administration (VBA) intended for a 20-year veteran of the United States Marine Corps who was suffering from Amyotrophic Lateral Sclerosis (ALS).

Joseph Smith, 71, pleaded guilty to one count of theft of government benefits and one count of conspiracy to steal government benefits before U.S. District Court Judge Julia E. Kobick, who scheduled sentencing for Jan. 15, 2025. Smith was charged in June 2024.

Shortly after the victim's ALS diagnosis in August 2015, the VBA approved the victim's application for disability benefits and awarded him approximately $8,318 in monthly payments. The VBA began issuing payments in September 2015 via monthly checks mailed to the victim's former residence in New Bedford, where he had resided with Smith's relative.

Between approximately 2015 and 2020, while the victim was hospitalized for ALS, Smith and others received monthly VBA disability checks intended for the victim and deposited those checks into bank accounts they controlled. Smith first deposited the disability checks into a bank account in his own name and then began depositing the checks into a bank account that he and others fraudulently opened in the name of victim. Shortly after depositing the disability checks, Smith withdrew the funds in cash and used the money for personal expenses.

In total, between in or around 2015 and 2020, Smith and others stole more than $450,000 in VBA disability benefits intended for the victim.

"This defendant's craven actions represent a gross betrayal of our nation's veterans and the sacrifices they make to keep our country free and safe. Stealing from a Marine Corps veteran who bravely served for 20 years and was literally fighting for his life as he battled a devastating illness is about as low as it gets and it is a crime," said Acting United States Attorney Joshua S. Levy. "Every American owes a debt of gratitude to the men and women who have worn the uniform. Stealing from them is simply immoral."

"Today's guilty plea underscores our commitment to investigating and holding accountable those involved in fraudulent activities, especially those who target our veterans," said Ketty Larco-Ward, Inspector in Charge of the U.S. Postal Inspection Service's Boston Division. "This investigation showcases the results that postal inspectors strive to achieve in collaboration with our law enforcement partners. We remain dedicated to our mission of identifying and prosecuting those who exploit others through fraudulent schemes."

"Today's guilty plea sends the message that the VA Office of Inspector General will work to hold accountable those individuals who would steal benefits intended for deserving veterans with disabilities," said Special Agent in Charge Christopher Algieri of the Department of Veterans Affairs Office of Inspector General's Northeast Field Office. "The VA OIG thanks the U.S. Attorney's Office and our law enforcement partners for their excellent work in pursuing justice in this case."

"Misusing someone's identity and Social Security number to steal federal disability benefits is a crime and these particular offenses are deplorable," said Michelle L. Anderson, Acting Inspector General for the Social Security Administration. "My office will continue working with our law enforcement partners to protect taxpayers' funds from those seeking to defraud federal programs. I thank our partners and the U.S. Attorney's Office for their work in this case."

The charge of theft of government benefits provides for a sentence of up to 10 years in prison, three years of supervised release and a fine of $250,000 or twice the gross gain or loss, whichever is greater. The charge of conspiracy to steal government benefits provides for a sentence of up to five years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.

Acting U.S. Attorney Levy, USPIS INC Larco-Ward, VA-OIG SAC Algieri and SSA-OIG Acting INC Anderson made the announcement today. Assistant U.S. Attorney Benjamin A. Saltzman of the Securities Financial & Cyber Fraud Unit is prosecuting the case.

Updated September 25, 2024