A traveling contractor working under a Customs and Border Protection (CBP) contract in the San Diego area has admitted he milked the government’s travel system for six figures. Neery Velazquez pleaded guilty Thursday in federal court to submitting dozens of bogus travel reimbursement claims, using forged paperwork and sham leases to pad his expenses after relocating to San Diego. Prosecutors say his case is now folded into a broader probe of travel-benefits abuse at his employer, a reminder of how supposedly routine expense reports can quietly snowball into serious losses for taxpayers.
Under his plea agreement, Velazquez acknowledged filing $244,019.48 in fraudulent travel claims and collecting $181,082.85 before the scheme was uncovered, according to FOX 5 San Diego. Prosecutors say the fraud played out over roughly 35 monthly submissions between 2021 and 2024, with forged receipts designed to make ordinary trips look like extended official travel.
Federal policy draws a firm line between everyday commuting and legitimate billable travel, generally reserving per diem and lodging reimbursements for assignments more than about 50 miles from a worker’s official duty station. Guidance from the GSA explains how a change in residence or duty station can instantly change who qualifies for travel payments, a technicality that can turn into a headache for agencies and contractors if it is not tracked carefully.
The investigation, run by the Department of Homeland Security Office of Inspector General alongside CBP internal offices, uncovered wider issues at the contracting firm. Out of about 100 employees classified as travelers, investigators allege nearly one-third submitted improper claims totaling more than $1.59 million. Officials say Velazquez forged a fake lease and other records to make his supposed costs look higher, and that CBP later withheld payments to the company to claw back some of the losses. FOX 5 San Diego reviewed court files and reporting tied to the probe.
Charges and What Comes Next
Velazquez entered his guilty plea yesterday to a single count of fraud. Sentencing is set for July 14, according to court records. At that hearing, the judge will weigh restitution, possible fines, and a prison term, the standard menu of penalties in federal fraud cases.
Local Fallout and Contract Oversight
In the wake of the investigation, CBP has changed how it scrutinizes and pays travel claims under the contract, and prosecutors say the contractor’s volume of reimbursement requests has dropped since investigators began reviewing records. The Velazquez case has become a local example of what can go wrong when travel rules, documentation standards, and agency oversight do not keep up with large, mobile contractor workforces that hop between regions.
