Former Navy Sailor Sentenced to 30 Months in Federal Prison for Fraud Schemes

February 16, 2010 - Nora R. Dannehy, United States Attorney for the District of Connecticut, announced that MICHAEL L. WILLIAMS, 38, of Hamden, was sentenced today by United States District Judge Christopher F. Droney in Hartford to 30 months of imprisonment, followed by three years of supervised release. On October 15, 2008, WILLIAMS pleaded guilty to one count of bank fraud and one count of making a false statement in a health care matter.

According to court documents and statements made in court, from October 1988 until his discharge on approximately August 14, 2003, WILLIAMS was a member of the United States Navy/United States Naval Reserve. Beginning on approximately April 18, 2003 and continuing until approximately August 14, 2003, WILLIAMS was assigned to the Transient Personnel Unit (TPU), Norfolk Naval Station. A Transient Personnel Unit serves as a temporary or transient residence for service personnel awaiting assignment to a permanent duty station, or for service personnel moving between duty stations. WILLIAMS has admitted that, during his assignment to TPU, Norfolk, and for a period of time thereafter, he participated in a scheme to defraud USAA Federal Savings Bank.

As part of the scheme, WILLIAMS fraudulently opened bank accounts and then withdrew funds from those accounts before USAA Bank discovered the fraud. WILLIAMS also used at the identities of 10 U.S. Naval service members to open the bank accounts. When the bank accounts were opened, WILLIAMS received debit cards at various addresses in Virginia and Connecticut, and then used the debit cards associated with the fraudulently opened accounts. Through this scheme, USAA Bank was defrauded of approximately $69,000.

After WILLIAMS’ discharge from the U.S. Navy, he sought medical treatment on several occasions at U.S. Department of Veterans Affairs (“VA”) facilities in Connecticut, and at other locations. On several occasions, WILLIAMS stated that he had recently suffered seizures and, as a result of his complaints, he received treatment, including prescription medications, from VA facilities and other providers. On approximately October 20, 2003, WILLIAMS filed a claim with the VA seeking compensation benefits for a service connected disability. As part of his claim, he stated that he suffered from a service connected disability arising from seizures.

On approximately October 30, 2006, WILLIAMS provided the VA with a letter from “Yale University School of Medicine, Department of Neurology” dated March 10, 2006 wherein it stated that a physician had examined an MRI of the defendant’s and found that he had a “cyst/tumor mass” located in his “front temporal lobe.” As a result of receiving this letter, the provider at the VA changed her determination and found that it is as likely as not that WILLIAMS’ seizure disorder is related to his active duty in the U.S. Navy. However, WILLIAMS admitted that the March 10 letter was fraudulent in that the purported author was not a medical doctor as described in the letter, the author of the letter never met or examined WILLIAMS, and no provider at Yale had ever diagnosed the condition as described in the letter.



As a result of the fraudulent letter and other false statements by the defendant, the VA increased WILLIAMS’ service-related pension. Also, when WILLIAMS applied for Social Security disability payments, the false records were considered by the Social Security Administration, which granted WILLIAMS disability payments for himself and his minor daughter.

Judge Droney has scheduled a restitution hearing for April 16 to resolve a dispute between the parties concerning the amount of restitution WILLIAMS must make to the VA and the Social Security Administration arising from the false documents, which the Government will argue is approximately $120,000.

WILLIAMS has been detained in federal custody since his arrest on July 16, 2008.

This matter was investigated by the Federal Bureau of Investigation, United States Postal Inspection Service, Office of the Inspector General for the U.S. Department of Veterans Affairs, U.S. Department of Veterans Affairs Police, Naval Criminal Investigative Services, and Office of the Inspector General for the Social Security Administration. The case was prosecuted by Assistant United States Attorneys David J. Sheldon and Brian P. Leaming.