A federal judge convicted a 47-year-old man in San Antonio of scheming to defraud the federal government with respect to the use of GI Bill benefits to train service canines and their handlers, prosecutors announced.
Following a 10-day bench trial, Senior U.S. District Judge David A. Ezra rendered his verdict in the case against Bradley Lane Croft, owner of Universal K-9, Inc.
Croft was convicted on Nov. 6 of eight counts of wire fraud, four counts of aggravated identity theft, two counts of money laundering and two counts of making a false tax return, prosecutors said.
Testimony provided at trial revealed that beginning in 2013, Croft provided false information in applications to the Texas Veterans Commission, including instructors’ names, certifications and training documents indicating that certain individuals would be instructors at the school, to receive GI Bill educational benefit payments, prosecutors said.
Croft and others solicited veterans as students indicating that they could use their GI Bill benefits to pay for a dog handler’s course that cost from $6,500 for the K-9 Handler dual-purpose detection program to $12,000 for the K-9 trainer/instructor program, according to prosecutors.
Since 2016, Universal K-9 filed approximately 185 claims relating to the education of approximately 132 veterans and totaling over $1.26 million; testimony also revealed Croft submitted fraudulent income tax returns showing his 2016 reported income as $2,000 and his reported income as $2,000 for 2017. Evidence showed that Croft actually received substantially more income than what he reported to the IRS in 2016 and 2017.
“The FBI would like to thank the U.S. Attorney’s Office, and our partner agencies IRS-CI and VA-OIG for their tireless efforts on this very important case. We would also like to recognize the outstanding contributions of the lead investigator for the FBI, who is a task force officer from the Texas Department of Public Safety and assigned to San Antonio FBI's Public Corruption and White Collar Crime Task Force. Our task forces are one of the FBI's greatest strengths; they leverage the resources and expertise of our partner agencies, enhancing our ability to protect our community from both criminal and national security threats,” stated FBI Special Agent in Charge Christopher Combs.
“Today’s guilty verdict was reached under the leadership of the U.S. Attorney’s Office, and as a result of the extensive work of special agents of the VA Office of Inspector General, the Internal Revenue Service-Criminal Investigation, and the FBI,” stated VA-OIG Special Agent in Charge James Ross. “These charges send a clear signal that any institution entrusted with the education of veterans will be held accountable for defrauding the GI Bill program.”
The case was prosecuted by U.S. Attorney John F. Bash; FBI Special Agent in Charge Christopher Combs, San Antonio Division; IRS-Criminal Investigation Special Agent in Charge Richard D. Goss, Houston Field Office; and, U.S. Department of Veterans Affairs Office of Inspector General (VA-OIG) Criminal Investigations Division Special Agent in Charge James Ross, South Central Field Office.
The government is also seeking the criminal forfeiture of alleged proceeds derived from the defendant’s illegal scheme including a 2017 American Eagle Motorhome, two late model pickup trucks, two jet skis, one trailer, approximately $138,000 in U.S. Currency and the real property located in the 15000 block of Tradesman in San Antonio.
On Aug. 8, 2018, federal authorities executed a search warrant at Croft’s business in San Antonio. A total of 26 canines at the business were placed into the custody of the city’s Animal Care Services.
Croft, who was remanded into the custody of the U.S. Marshals Service following the verdict, faces up to 20 years in federal prison for wire fraud, up to 20 years in federal prison for money laundering and up to two years in federal prison for aggravated identity theft. Sentencing has yet to be scheduled.
The FBI, IRS-CI, and the VA-OIG investigated this case. Assistant U.S. Attorneys Gregory J. Surovic and Fidel Esparza, III, are prosecuting this case on behalf of the government.