A U.S. Navy doctor pleaded guilty on March 28 in federal court in San Diego, California to defrauding a Navy-funded insurance program out of $2 million.
Dr. Michael Villarroel, 48, of Coronado, California admitted that he and others conspired to defraud the Navy by faking or exaggerating injuries in order to obtain insurance payments intended to help service members recovering from traumatic injuries.
Villarroel acknowledged he knew the claimed injuries were false or exaggerated but signed off on applications for a share of the insurance payments, according to a Department of Justice release.
Participants in the scheme obtained about $2 million in payments from the Traumatic Servicemembers Groups Life Insurance program which is funded by service members and the Navy. Villarroel personally obtained more than $180,000 in kickbacks.
“These military healthcare dollars, which were intended to benefit injured and traumatized service members, instead funded a fraudulent windfall,” said U.S. Attorney Randy Grossman.
Villarroel admitted that from 2012 to at least December 2015, he conspired to commit wire fraud with Christopher Toups, a chief petty officer construction mechanic in the Navy; Kelene Meyer, Toups’ spouse and a nurse; and others.
Toups prodded other service members to submit claims, told them to provide medical records to Meyer, requested part of the insurance payment in return, and distributed shares to Meyer and Villarroel, according to the release. Meyer used her medical background to falsify or doctor supporting records to reflect fake or exaggerated injuries.
Related
Villarroel claimed to have reviewed medical records and verified disabilities consistent with the injuries as needed for claims to be processed and qualify. Villarroel supported his determination by falsely stating he sometimes interviewed the claimant. At other times Villarroel gave Meyer medical records belonging to others to use in fabricating claims.
Toups paid Villarroel in cash and by cashier’s check and, at points, Villarroel conducted transactions in amounts under $10,000 to evade currency transaction reporting requirements.
Villarroel is the tenth defendant to plead guilty to crimes committed under the scheme. Several conspirators were members of Explosive Ordinance Disposal Expeditionary Support Unit One, based in Coronado, California.
Related
“Dr. Villarroel abused his position of trust to enrich himself and his co-conspirators,” said Special Agent in Charge Stacey Moy of the FBI’s San Diego Field Office. “As a medical doctor and Naval Commander, Dr. Villarroel is held to a higher standard which makes this scheme to defraud the Traumatic Service Members Group Life Insurance program even more egregious.”
Villarroel is scheduled to be sentenced on June 16 by U.S. District Judge Janis L. Sammartino.
Reach Julia LeDoux at Julia@connectingvets.com.