A 45-year-old woman from Alloway, New Jersey, and her 42-year-old partner in Bogota, Colombia, have been convicted by a federal jury of orchestrating a nationwide scheme that stole millions of dollars in federal program funds meant to help elderly, disabled, and homeless Americans. Jael Watts and Luis Pino-Copete ran their operation through a shell company called Pearl Transit Corporation, which claimed to employ drivers providing rides to seniors and outreach to unhoused people across multiple states while actually delivering no services at all.
According to the Justice Department, the scheme targeted funds administered by the U.S. Department of Transportation and the U.S. Department of Housing and Urban Development, agencies that distribute federal dollars meant to benefit some of the country's most vulnerable residents. Pearl Transit Corporation, headquartered in New Jersey, operated as what the Legal Reader described as a non-profit facade without actual personnel or transit assets, employing no real drivers and serving no real clients despite its paperwork claiming otherwise.
The numbers behind the fraud are staggering even by federal standards. Watts and Pino-Copete submitted more than $13 million in fraudulent claims between July 2019 and October 2025, though federal court evidence established that they actually succeeded in diverting over $1.6 million in government funds before the scheme was caught.
Local Agencies Across the Country Took the Hit
The money came out of real local budgets. Gwinnett County, Georgia lost $529,500 in Community Development Block Grant funds, while the Los Angeles County Metropolitan Transportation Authority was defrauded of $429,885 in Section 5310 funds intended to improve mobility for seniors and people with disabilities. The City of Raleigh, North Carolina lost $379,149 in similar Section 5310 funding, and Kern County, California was out $283,000 in Emergency Solutions Grant money.
Those federal pass-through dollars are typically disbursed to local jurisdictions and only caught by audits well after the fact, a structural gap the scheme appears to have exploited for years. The programs targeted included the Federal Transit Administration's Section 5310 Enhanced Mobility of Seniors and Individuals with Disabilities Program, HUD's Community Development Block Grants, and Emergency Solutions Grants, some of which were backed by COVID-19 CARES Act funding.
Stolen Identities, Dead Clients, and a Forged Attorney's Name
To make Pearl Transit's rosters look legitimate, the defendants used the stolen identities of real people, including individuals who had died, and listed drivers who did not have driver's licenses or had never driven a car. A December 2025 superseding indictment also alleges that Watts forged a licensed attorney's name without consent on a March 2022 Federal Transit Administration grant application, a move prosecutors say was meant to bolster the shell company's institutional credibility, according to the U.S. Attorney's Office for the Northern District of New York.
Administrative enforcement began well before the jury's verdict. The Federal Transit Administration suspended Pearl Transit Corporation and Operations Manager Jael Watts from federal procurement on December 3, 2025, then suspended Regional Manager Luis Pino-Copete on February 17, 2026, according to the U.S. Department of Transportation Office of Inspector General. Those suspensions blocked both defendants and the company itself from participating in federal grant programs even before criminal charges caught up with them.
Case Tried in Albany, Part of Broader Anti-Fraud Push
The trial was conducted in the U.S. District Court for the Northern District of New York in Albany, prosecuted by attorneys from the U.S. Attorney's Office alongside the Department of Justice's National Fraud Enforcement Division. The case was tried there in part because the New York State Department of Transportation administered some of the exploited grant funds.
The conviction lands squarely within a larger federal effort. The Department of Justice formally announced the creation of its National Fraud Enforcement Division on April 7, 2026, to support President Trump's Task Force to Eliminate Fraud, which Vice President J.D. Vance chairs. The division was built to centralize federal benefit fraud prosecutions nationwide, and this case now stands as one of its marquee results.
Decades in Prison Possible at Sentencing
Watts and Pino-Copete now face substantial prison exposure. Federal wire fraud conspiracy and wire fraud charges each carry a statutory maximum of up to 20 years in prison, while aggravated identity theft carries a mandatory consecutive two-year prison sentence under federal law. Sentencing has not yet been scheduled according to available records, leaving the ultimate punishment for the pair still undetermined.
