On Friday, December 20, 2013 the Department of Justice announced that a federal grand jury in New Mexico returned a nine-count indictment against a retired colonel and a sergeant in the Army National Guard.  The case is being prosecuted by the Public Integrity Section of the Department Justice, a litigating section of the Criminal Division based out of Washington, DC.

Retired Colonel Isaac Alvarado, 74, of Albuquerque, N.M. was charged with one count of conspiracy to commit wire fraud, four counts of wire fraud and four counts of aggravated identity theft in an indictment that was filed this week in the U.S. District Court for the District of New Mexico.   Sergeant First Class Travis Nau, 40, also of Albuquerque, N.M., was charged with one count of conspiracy to commit wire fraud, three counts of wire fraud and three counts of aggravated identity theft.

According to court documents, in approximately September 2005, the National Guard Bureau entered into a contract with Document and Packaging Broker Inc. to administer the Guard Recruiting Assistance Program (G-RAP).   The G-RAP was a recruiting program that was designed to offer monetary incentives to soldiers of the Army National Guard who referred others to join the Army National Guard.   Through this program, a participating soldier could receive bonus payments for referring another individual to join.   Based on certain milestones achieved by the referred soldier, a participating soldier would receive payment through direct deposit into the participating soldier’s designated bank account.   To participate in the program, soldiers were required to create online recruiting assistant accounts.   The rules prohibited Army National Guard recruiters from participating in the G-RAP.

According to court documents, between approximately November 2007 and February 2012, Alvarado participated as a recruiting assistant in the G-RAP.   Nau, who worked in a recruiting office and is Alvarado’s son-in-law, allegedly provided Alvarado with the names and Social Security numbers of potential soldiers.   This enabled Alvarado to claim that he was responsible for referring these potential soldiers to join the military, when in fact he did not recruit any of them.   In addition, Nau advised at least two potential soldiers to falsely report that Alvarado had assisted in their recruitment even though he had not.   As a result, Alvarado allegedly received a total of approximately $12,000 in fraudulent recruiting bonuses.

$12,000 in fraudulent recruiting bonuses is not much.  However, when considering federal fraud charges one must understand that a minimum threshold loss amount is not an element of the offense.  Instead, a fraud conviction with a relatively minor loss amount will be reflected in a relatively low recommended guideline sentence.  For example, an examination of Sec. 2B1.1 of the Guidelines shows that the defendants in this case are looking at an offense level of 11 if no other adjustments apply.  This offense level corresponds with a Zone B sentencing range of 8 to 14 months if neither defendant has a criminal history.   Not only would the defendants be statutorily eligible for probation, the guidelines in this case would also recommend a sentence of probation.

This post is authored by Ferrari & Associates, P.C., a law firm specializing in federal criminal defense matters. Feel free to contact us at (202) 280-6370 or info@ferrariassociatespc.com.