A Navy doctor pleaded guilty Tuesday to defrauding the VA by feigning or exaggerating a military member’s injuries to obtain insurance payments, the 10th defendant to plead for their role in the scheme, the US Attorney’s Office for the Southern District of California announced.
cmdr. Michael Villarroel, 51, and other co-conspirators ended up getting about $2 million in fraudulent payments through Group Life Insurance’s Traumatic Injury Protection program, also known as TSGLI. The Department of Veterans Affairs program is funded by monthly premiums paid by service members who are registered with SGLI.
While the program serves to provide financial support for troops recovering from serious injuries, Villarroel personally pocketed more than $180,000 from the program as part of the scheme, the attorney general’s office said in a release announcing his application.
As part of the conspiracy plea to commit wire fraud charges, Villarroel “admitted that he knew the injuries claimed were false or exaggerated but signed the application for part of the insurance payment,” the FBI said.
“These military health care dollars, intended to benefit injured and traumatized service members, instead fund windfalls,” US Attorney Randy Grossman said in a statement.
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Several of the conspirators, including Villarroel, were assigned to the 1st Explosive Weapons Disposal Expeditionary Support Unit at Coronado, just outside San Diego.
Villarroel admitted that from 2012 until at least December 2015, he conspired with Christopher Toups, a former Navy Chief, and Kelene Meyer, Toups’ wife and a nurse.
As part of the conspiracy, “Toups encouraged other service members to file claims, told them to provide medical records to Meyer, demanded a portion of the insurance payment in return and distributed shares to Meyer and Villarroel,” the attorney’s office said.
Villarroel admitted to claiming qualified medical records and, at times, falsely stating that he had interviewed plaintiffs.
“At another time Villarroel provided another person with Meyer’s medical records for use in making a claim,” according to the attorney’s office. “Toups paid Villarroel in cash and by cashier’s check and, at the point, Villarroel made transactions in amounts under $10,000 to circumvent currency transaction reporting requirements.”
Lawyers for Villarroel did not respond to a request for comment by the Navy Times deadline.
Service records show he remains in the Navy and has been assigned to the Coronado EOD unit since 2018.
Villarroel is scheduled to be sentenced on June 16 and faces a maximum sentence of 20 years in prison and a $250,000 fine, forfeiture and restitution.
Geoff is a senior staff reporter for Military Times, with a focus on the Navy. He covered Iraq and Afghanistan extensively and was most recently a reporter for the Chicago Tribune. He accepts all kinds of tips at [email protected]