A former U.S. Navy doctor was sentenced to just over a year behind bars for defrauding the government out of $2 million, officials said. Dr. Michael Villarroel, 51, from Coronado, California, was handed a sentence of one year and a day in custody, along with being ordered to serve up $180,000 in criminal forfeiture, after pleading guilty to a conspiracy charge related to fleecing a military insurance program designed to assist injured service members, the U.S. Attorney's Office announced.
Villarroel was accused of concocting fraudulent claims for the Traumatic Servicemembers Group Life Insurance Program (TSGLI), a fund meant to help those who have suffered grave and life-altering injuries while on duty. His scheme, which ran between 2012 and 2015, involved other Navy members to quickly secure insurance payments based on fabricated or exaggerated injuries. "As fraudulent schemes go, this one was egregious," U.S. Attorney Tara McGrath said. “Today the defendant found out there is a high price to be paid for pocketing money intended for injured and traumatized servicemembers,” McGrath revealed in a statement.
The court heard how Villarroel admitted to having conspired with others to swipe money from the U.S. by making false claims for life insurance payments. The doctor falsely certified that he had reviewed the records and had confirmed the injuries as legitimate, all the while knowing fully well they were fake or grossly exaggerated. In some instances, he lied about having interviewed the claimant and even provided others with actual medical records to use in falsifying claims.
The severity of Villarroel's offense was underscored by the FBI and the Naval Criminal Investigative Service (NCIS), who worked closely to bring the fraudulent activities to light. "Michael Villarroel’s blatant abuse of his position of trust within the United States military is unscrupulous and this sentencing proves that such actions will not be tolerated," FBI San Diego Acting Special Agent in Charge John Kim stressed. Special Agent in Charge Greg Gross of the NCIS Economic Crimes Field Office added, “NCIS and our partners are committed to rooting out corruption that threatens the safety and wellbeing of our service members and their families.”
Villarroel's case is connected to several other related prosecutions involving members of the Naval community, including individuals from Florida, Georgia, Texas, and California. The charges they face, like Villarroel's, carry maximum penalties ranging from five to twenty years in prison and fines up to $250,000. All cases pertain to defrauding the government through the TSGLI program, which is funded by servicemembers and the Department of the Navy, and administered by Prudential.
The U.S. Attorney's Office continues to prosecute these cases, sending a clear message that defrauding veteran programs is a serious crime that will result in serious time.
