By Stephen Appezzato
COLTS NECK – A former U.S. Army financial counselor, Army Reserve major and Colts Neck resident was sentenced to 151 months in prison last week for defrauding Gold Star families of their survivor bonuses. Alongside his prison term, Caz Craffy will forfeit $1.4 million, be subject to three years of supervised release and pay an undetermined amount of restitution.
The 42-year-old financial advisor made headlines last year after he was indicted on multiple counts of wire and securities fraud. In April, he pleaded guilty before U.S. District Judge Georgette Castner in Trenton to six counts of wire fraud and one count each of securities fraud, making false statements in a loan application, committing acts affecting a personal financial interest and making false statements to a federal agency.
When an armed service member dies during active duty, their surviving beneficiary is given a $100,000 payment, as well as the service member’s life insurance of up to $400,000. To assist these Gold Star families, the military provides certain services following a soldier’s death, including general financial counseling.
Craffy first came under scrutiny after a February 2023 Washington Post report about complaints from several of his victims, prompting an investigation from the Department of the Army Criminal Investigations Division.
From November 2017 to January 2023, Craffy was a civilian employee of the U.S. Army working as a financial counselor under the Casualty Assistance Office, tasked with providing basic financial education to families. Craffy was prohibited from offering personal opinions around investments and participating in government matters in which he had a personal financial interest. However, during this time he was employed by two financial investment firms – Monmouth Capital Management and a Florida-based firm.
Using his position with the U.S. Army, Craffy targeted Gold Star families and encouraged them to invest their benefits in accounts he managed with those investment firms. According to the Justice Department, Craffy made false representations and omissions to convince these families their money was being managed with the Army’s oversight.
“They believed Craffy was acting in their best interest, but instead, he was using their money as a method to make his own. Heartless and despicable don’t even begin to sum up his crimes,” said FBI Newark special agent in charge James Dennehy in a release.
From May 2018 to November 2022 the Colts Neck resident invested over $9.9 million in families’ survivor benefits in investment accounts he oversaw. Craffy executed trades, often without families’ consent, earning himself a high commission. During this period these families lost more than $3.7 million while Craffy pocketed over $1.4 million.
“No amount of money can undo their enormous loss. Instead of offering guidance, Caz Craffy chose to defraud these heroic families,” said U.S. Attorney Philip Sellinger, who presides over New Jersey. “The lengthy term of imprisonment imposed today is just punishment for this heinous and shameless crime,” he said.
In addition to these charges, the U.S. Securities and Exchange Commission has a civil complaint pending against Craffy based on his actions, and he has been permanently barred from associating with any Financial Industry Regulatory Authority member.
The article originally appeared in the August 29 – September 4, 2024 print edition of The Two River Times.
