Woman stole over $100M in Army grant money to buy extravagant houses, jewelry, report says

A former Army civilian employee was sentenced to 15 years in federal prison for stealing over $108 million from a grant program intended to provide services to military dependents and their families.

Janet Yamanaka Mello, 57, was sentenced by U.S. District Judge Xavier Rodriguez in federal court in San Antonio, having pleaded guilty on March 7 to mail fraud and tax charges for a scheme that went undetected by the Army for almost seven years.

“Janet Mello betrayed the trust of the government agency she served and repeatedly lied in an effort to enrich herself,” said U.S. Attorney Jaime Esparza for the Western District of Texas.

Who is Janet Yamanaka Mello?

According to an official press release by the United States Attorney’s Office of Western District of Texas, Mello worked as a financial program manager for the U.S. Army and Installation Management Command for G9 (Morale, Welfare and Recreation) Child and Youth Services (CYS) at Fort Sam Houston.

What did Janet Yamanaka Mello do?

According to the press release, Mello formed a business called Child Health and Youth Lifelong Development (CHYLD) in or around December 2016 through at least August 29, 2023.

The sole purpose of CHYLD was to receive grant funds from the 4-H Military Partnership Grant program, which Mello illicitly obtained through her role as a CYS financial program manager. Prosecutors said Mello used the fake organization to apply for over 40 grants through the military program.

Once she received a check, instead of providing financial care for military children throughout the world, she deposited it into her bank account and spent the money on luxury items such as clothing, jewelry, vehicles and real estate, according to the press release.

According to AP news, her expenses included a $923,000 jewelry purchase on one day in 2022 — and 82 vehicles that included a Maserati, a Mercedes, a 1954 Corvette and a Ferrari Fratelli motorcycle.

"She selfishly stole that money to buy extravagant houses, more than 80 vehicles and over 1,500 pieces of jewelry," said Esparza.

Court documents indicate that Mello repeated this process 49 times during a six-year period, requesting approximately $117,000,000 in payments and receiving approximately $108,917,749.

Mello omitted millions of dollars, failed to accurately report income

Mello failed to accurately report her income for tax years 2017, 2019, 2020, 2021 and 2022, omitting the millions of dollars of income she fraudulently received through CHYLD.

"Her actions reflect exactly the opposite of what it means to serve your country, and my office will continue to work tirelessly to prosecute those who illegally seek personal gain at the expense of their fellow citizens,” accreted Esparza.

Special Agent in Charge Maria Thomas for the Department of the Army Criminal Investigation Division, Central Texas Field Office, argued that corruption and fraud schemes like this in the U.S. Army jeopardize the safety and security of soldiers and their families. She said the Army community is committed to aggressively pursuing anyone who uses government programs for their personal gain.

"Mello's penchant for extravagance is what brought her down. We identified that her reported income was well below the lavish lifestyle she lived. As we uncovered the details, the criminal scheme grew, the dollar amount grew, and the reach of her spending grew," said Acting Special Agent in Charge Lucy Tan of IRS Criminal Investigation's Houston Field Office. "Financial crimes have victims, and this one took opportunities away from the children and families of our military men and women."

This article originally appeared on Austin American-Statesman: Woman stole over $100M in Army grant money to buy extravagant houses, jewelry, report says