A Navy doctor pleaded guilty Tuesday to ripping off the VA by faking or exaggerating servicemember injuries to obtain insurance payouts, the 10th defendant to plead to their roles in the scheme, the U.S. Attorney’s Office for the Southern District of California announced.

Cmdr. Michael Villarroel, 51, and other co-conspirators ended up getting about $2 million in bogus payments through the Servicemembers’ Group Life Insurance Traumatic Injury Protection program, also know as TSGLI. The Department of Veterans Affairs program is funded by the monthly premiums paid by servicemembers enrolled SGLI.

While the program works to provide financial support for troops recovering from severe injury, Villarroel personally pocketed more than $180,000 from the program as part of the scheme, the attorney general’s office said in a release announcing his plea.

As part of the plea to conspiracy to commit wire fraud charge, Villarroel “acknowledged he knew the claimed injuries were false or exaggerated but signed off on applications for a share of the insurance payments,” the feds said.

“These military healthcare dollars, which were intended to benefit injured and traumatized service members, instead funded a fraudulent windfall,” U.S. Attorney Randy Grossman said in a statement.

Several of the conspirators, including Villarroel, were assigned to Explosive Ordnance Disposal Expeditionary Support Unit 1 in Coronado, just outside San Diego.

Villarroel admitted that from 2012 to at least December 2015, he conspired with Christopher Toups, a former Navy chief, and Kelene Meyer, Toups’ wife and a nurse.

As part of the conspiracy, “Toups prodded other service members to submit claims, told them to provide medical records to Meyer, requested part of the insurance payment in return and distributed shares to Meyer and Villarroel,” the attorney’s office said.

Villarroel admitted to claiming medical records were qualified and, at times, falsely stating that he had interviewed the claimant.

“At other times Villarroel gave Meyer medical records belonging to others to use in fabricating claims,” according to the attorney’s office. “Toups paid Villarroel in cash and by cashier’s check and, at points, Villarroel conducted transactions in amounts under $10,000 to evade currency transaction reporting requirements.”

Villarroel’s attorney did not respond to a request for comment by Navy Times’ deadline.

Service records show he remains in the Navy and has been assigned to the Coronado EOD unit since 2018.

Villarroel is scheduled to be sentenced on June 16 and faces a maximum penalty of 20 years in prison and $250,000 in fines, forfeiture and restitution.

Geoff is the editor of Navy Times, but he still loves writing stories. He covered Iraq and Afghanistan extensively and was a reporter at the Chicago Tribune. He welcomes any and all kinds of tips at geoffz@militarytimes.com.

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