COLTS NECK – A major in the U.S. Army Reserves who works as a financial advisor has been indicted for ripping off families who have lost a loved one in the military.
Caz Craffy, a/k/a “Carz Craffey,” 41, of Colts Neck, was charged with six counts of wire fraud and one count each of securities fraud, making false statements in a loan application, committing acts furthering a personal financial interest, and making false statements to a federal agency.
“Gold Star families are given a title no one would choose because it means they’ve paid the ultimate sacrifice for this country,” said Special in Charge James E. Dennehy of the Newark FBI. “The soldier, sailor, marine or airman they loved died during a time of conflict – defending this nation. They are given money and assistance to help ease the burden that comes with losing their loved one, however no amount of money can replace what they’ve lost. We allege Craffy took advantage of his position and defrauded families already going through a tremendous amount of suffering.”
Authorities said that Gold Star families are entitled to a $100,000 death gratuity and up to $400,000 in life insurance. The military provides a number of services to the family, including making a financial advisor available.
From November 2017 to January 2023, Craffy was a civilian employee of the U.S. Army, working as a financial counselor with the Casualty Assistance Office. He was responsible for providing general financial education to the surviving beneficiaries. However, he was prohibited from offering any personal opinions regarding benefits and he was prohibited from working with any civilian firms.
He is accused of telling families to invest in two accounts he managed privately. The families thought he was doing so on behalf of the military.
From May 2018 to November 2022, Craffy allegedly obtained more than $9.9 million from Gold Star families to invest in accounts he managed. He would then make unauthorized trades that earned him high commissions. During this time, the families lost more than $3.4 million while he earned more than $1.4 million in commissions.
The wire fraud and securities fraud charges come with a maximum of 20 years in prison. The charge of submitting a false statement on a loan application is punishable by a maximum of two years in prison. The charges of acts affecting a personal interest and false statements to a federal agent are each punishable by five years in prison. All counts but the securities fraud count are also punishable by a maximum fine of either $250,000 or twice the gain or loss from the offense, whichever is greatest. The securities fraud count is punishable by a maximum fine of either $5 million or twice the gain or loss from the offense, whichever is greatest.
The U.S. Securities and Exchange Commission (SEC) also filed a civil complaint against Craffy based on the same and additional conduct. He has been permanently prohibited from association with any member of the Financial Industry Regulatory Authority Inc. (FINRA).
U.S. Attorney Philip R. Sellinger credited special agents of the Department of the Army Criminal Investigation Division, under the direction of Special Agent in Charge Kirch; special agents of DCIS, under the direction of Principal Deputy Director Ives; special agents of the FBI, under the direction of Special Agent in Charge Dennehy; and special agents of Homeland Security Investigations Newark, under the direction of Special Agent in Charge Patel with the investigation leading to the indictment. He also expressed appreciation for the Securities and Exchange Commission, under the direction of Gurbir S. Grewal, Director, Division of Enforcement, and FINRA, under the direction of Acting Head of Enforcement Christopher J. Kelly.
