{"id":32790,"date":"2023-07-07T17:12:24","date_gmt":"2023-07-07T21:12:24","guid":{"rendered":"https:\/\/ifintechworld.com\/news\/army-financial-counselor-defrauded-families-of-men-and-women-who-made-the-ultimate-sacrifice-out-of-millions-prosecutors-charge\/"},"modified":"2023-07-07T17:12:26","modified_gmt":"2023-07-07T21:12:26","slug":"army-financial-counselor-defrauded-families-of-men-and-women-who-made-the-ultimate-sacrifice-out-of-millions-prosecutors-charge","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=32790","title":{"rendered":"Army financial counselor defrauded families of men and women who \u2018made the ultimate sacrifice\u2019 out of millions, prosecutors charge"},"content":{"rendered":"
\n

A financial counselor for the Army has been charged with defrauding the families of military personnel, who died in the line of duty, out of millions of dollars in death benefits, steering their funds into risky investments to generate gains for himself, prosecutors said.\u00a0<\/p>\n

Caz Craffy, 41, of Colts Neck, N.J., had been assigned to work with the U.S. Army\u2019s Casualty Assistance Office at Joint Base McGuire-Dix-Lakehurst, helping manage the survivor benefits for so-called Gold Star families.<\/p>\n

\n

A major in the U.S. Army Reserves, Craffy was tasked with providing families information about general financial strategies. He was prohibited, however, from offering specific investment advice, according to federal prosecutors. <\/p>\n

Financial counselors are authorized to provide general financial information but are prohibited from providing advice on specific securities and are restricted from working for outside investment firms or for playing any direct role in the families\u2019 investment, court documents stated.<\/p>\n

But prosecutors said Craffy\u2014who also used the alias Carz Craffey\u2014worked for two outside investment firms, Newbridge Securities Corp. and Monmouth Capital Management, LLC, into which he steered $9.9 million from 29 families who had received benefits, prosecutors said. \u00a0\u00a0\u00a0<\/p>\n

Investigators say once Craffy had control of the families\u2019 money, he excessively executed trades\u2014often without the family\u2019s permission\u2014that generated a commission for him off each order \u2014 a tactic known as churning.<\/p>\n

From 2017 until early this year, prosecutors say Craffy earned $1.4 million in commissions off investments he made, while the families lost more than $3.4 million.<\/p>\n

\u201cStealing from Gold Star families whose loved ones made the ultimate sacrifice in service to our nation is a shameful crime,\u201d said Attorney General Merrick Garland.\u00a0<\/p>\n

The families of fallen servicemembers typically receive as much as $400,000 in life insurance payments plus $100,000 to make up for lost income. <\/p>\n

Prosecutors allege that Craffy took advantage of the families\u2019 lack of financial savvy, persuading them to grant him discretion to make investments on their behalf. He also often ignored their expressed instructions to make only conservative investments, prosecutors charged.<\/p>\n

In many cases, the beneficiaries of the accounts were minors, prosecutors said.<\/p>\n

Craffy was taken into custody Friday morning on charges of wire and securities fraud. He separately faces civil litigation from the Securities and Exchange Commission on similar charges.\u00a0<\/p>\n

Craffy couldn\u2019t be immediately reached for comment and it was unclear if he had retained an attorney.<\/p>\n

Earlier this year, Craffy was barred by the Financial Industry Regulatory Authority, or Finra, following the publication of a Washington Post expose into Craffy\u2019s activities.<\/p>\n

Craffy was dismissed by Monmouth Capital Management last November after it became aware he was under investigation, Finra said. <\/p>\n

On Friday, Finra announced that it had expelled Monmouth Capital after determining that \u201cchurning\u201d was a common practice at the firm. The agency had previously barred other brokers who worked there from the industry.<\/p>\n

Attempts to reach Monmouth were unsuccessful. <\/p>\n

Craffy faces up to 20 years in prison on each count of fraud if he is convicted, plus fines of up to $250,000. <\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

A financial counselor for the Army has been charged with defrauding the families of military personnel, who died in the line of duty, out of millions of dollars in death benefits, steering their funds into risky investments to generate gains for himself, prosecutors said.\u00a0 Caz Craffy, 41, of Colts Neck, N.J., had been assigned to […]<\/p>\n","protected":false},"author":1,"featured_media":32791,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[236],"tags":[83],"class_list":["post-32790","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-news","tag-featured","post_format-post-format-gallery"],"yoast_head":"\nArmy financial counselor defrauded families of men and women who \u2018made the ultimate sacrifice\u2019 out of millions, prosecutors charge | iFintechWorld<\/title>\n<meta name=\"description\" content=\"A financial counselor for the Army has been charged 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