Caz Craffy, 42, was sentenced to over 12 years in prison for defrauding Gold Star families of nearly $4 million in survivor benefits. Craffy, an Army Reserve major, used his position as a financial counselor to prey on grieving military families, prosecutors said. (X)

An Army Reserve major and financial counselor who defrauded grieving military families out of nearly $4 million in survivor benefits has been sentenced to over 12 years in prison.

Caz Craffy, 42, of Colts Neck, N.J., admitted in April to stealing from Gold Star families and committing related crimes.

On Wednesday, U.S. District Judge Georgette Castner ordered him to serve a 151-month sentence, the Justice Department said in a statement.

“Caz Craffy was sentenced to prison today for brazenly taking advantage of his role as an Army financial counselor to prey upon families of our fallen service members, at their most vulnerable moment, when they were dealing with a tragedy born out of their loved ones’ patriotism,” U.S. Attorney Philip R. Sellinger said in the statement.

From November 2017 to January 2023, Craffy, who was also known as “Carz Craffey,” held a civilian post at the Army’s Casualty Assistance Office, where he provided general financial education to beneficiaries of fallen service members.

Unbeknownst to the Army, Craffy simultaneously worked with two different financial investment firms and encouraged beneficiaries to invest their survivor benefits in accounts he managed.

When service members die during active duty, their next of kin are entitled to a $100,000 payment and the service member’s life insurance of up to $400,000.

The families of the fallen troops are known as Gold Star families. The military provides a range of services for them, including the assistance of a financial counselor.

In this screenshot from a Defense Department video, then-1st Lt. Carz Craffey sends Thanksgiving greetings from Baghdad in 2009. Also known as Caz Craffy, the Army Reserve major and financial counselor was sentenced to 151 months in prison for defrauding Gold Star families out of millions of dollars in survivor benefits. (Defense Department)

Many of the families that got advice from Craffy mistakenly thought he was investing their money with the Army’s authorization, according to court documents.

From May 2018 to November 2022, Craffy obtained nearly $10 million from Gold Star families to invest in accounts he managed privately, the Justice Department said.

He earned more than $1.4 million in commissions from executing trades — often without families’ authorization — while the family accounts lost more than $3.7 million, according to the department’s statement.

“Craffy made a conscious decision to defraud Gold Star families suffering from losing their loved ones who paid the ultimate sacrifice serving this country,” FBI – Newark Special Agent in Charge James E. Dennehy, who helped with the investigation, said in the statement.

He added that the money families receive is meant to ease financial burdens like mortgages and putting children through college.

“Heartless and despicable don’t even begin to sum up his crimes,” Dennehy said.

Craffy, who joined the Army Reserve in 2003, pleaded guilty in April 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.

In addition to the prison term, Craffy was sentenced to three years of supervised release and ordered to forfeit the $1.4 million he made in commissions. Restitution to the families he defrauded will be determined later, the statement said.

The U.S. Securities and Exchange Commission has a pending civil complaint against Craffy based on the same and additional conduct.

Special agents with the Army Criminal Investigation Division, the Defense Criminal Investigative Service, the FBI and the Homeland Security Department conducted the probe that resulted in Craffy’s indictment.

The Justice Department statement indicated that Craffy is still a reservist. Typically, an administrative or judicial process ends with the eventual removal from service of a soldier convicted of felonies.