TYLER, Texas (Tribune News Service) — A Tyler man has pleaded guilty to federal charges in the Eastern District of Texas, announced U.S. Attorney Brit Featherston.

Derek Robert Hamm, 38, pleaded guilty to wire fraud, money laundering, violating the Stolen Valor Act, using a fraudulent military discharge certificate, and being a felon in possession of firearms and ammunition.

The Stolen Valor Act of 2013 makes it illegal to fraudulently wear medals, embellish rank, or make false claims of military service to obtain money, employment, property, or some other tangible benefit. As part of the plea agreement, Hamm agreed to pay restitution of at least $2.3 million and forfeiture of the proceeds of his criminal conduct, including jewelry, automobiles, and cash proceeds in the amount of $1,675,000.

According to court documents, Hamm invented a persona of being a wealthy and successful war hero. Hamm held himself out to be a former member of the Army Special Forces who had served multiple tours of duty in Iraq, Afghanistan, and other countries. He claimed to have been awarded a Purple Heart, Silver Star, Bronze Star and Distinguished Service Cross for his service.

Hamm also represented that he was related to Harold Hamm, the billionaire oilman in Oklahoma, which he claimed gave him access to financial resources and oil industry expertise. Through this larger-than-life persona, Hamm created an extensive network of friends who introduced him to potential investors. Those investors believed Hamm's claims and invested in what they expected to be worthwhile ventures spearheaded by a trustworthy and capable entrepreneur.

In reality, Derek Hamm was nothing of the sort. Hamm was not a decorated war hero. He was no oil industry tycoon. He was not related to Harold Hamm. He did not spend investors' funds on the latest oil industry technology or new oil wells. Within hours of receiving investors' funds, Hamm spent their money on himself and his family, including expensive jewelry, vehicles and vacations to expensive resorts on private charter planes. All the while, Hamm represented to investors that he had invested their money in successful oil industry projects. Because of the Hamm war hero persona, the investors trusted Hamm even as their invested funds failed to produce any returns.

"Whenever people invent achievements and claim valor for things done by others, they tarnish the legacy and service of those men and women who have made real sacrifices in service to this country," Featherston said. "That is especially true when someone uses the valor of such service to ultimately steal from people. Hamm's repugnant actions are an insult to true American heroes who received real recognition for their real achievements."

Hamm also pleaded guilty to being a prohibited person in possession of firearms and ammunition. Hamm was convicted in Smith County in 2020 for theft of property, a state felony. As a felon, Hamm is prohibited by federal law from owning or possessing firearms or ammunition. According to court documents, Hamm was in possession of dozens of firearms, including several rifles with high-capacity magazines, and ammunition for those firearms.

A federal grand jury returned an indictment charging Hamm with federal violations on January 20, 2022. He faces up to 20 years in federal prison. A sentencing hearing will be scheduled after the completion of a presentence investigation by the U.S. Probation Office.

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Crime and courts