Iowa Sen. Chuck Grassley criticized the Defense Department for its “sloppy accounting” after Army employee Janet Mello embezzled $109 million from a military fund.
The 90-year-old Republican criticized the department for being “full of students who are slow learners and fast spenders” after the collapse of one of the biggest cases of fraud the military have never seen.
Civilian employee Mello, 57, of San Antonio, Texas, faces a maximum sentence of 125 years in prison after admitting to stealing nearly $109 million from a taxpayer fund.
Mello laundered money intended for military children and used it to finance his own extravagant lifestyle, including the purchase of designer clothing, jewelry, 31 houses and no fewer than 70 vehicles.
The scammer worked for the US Army at Fort Sam Houston in San Antonio as CYS Financial Program Manager and created a shell company, Child Health and Lifelong Youth Development, in 2016.
Iowa Senator Chuck Grassley (pictured) criticized the Department of Defense for its “sloppy accounting” after Army employee Janet Mello embezzled $109 million from a military fund.
Civilian employee Janet Mello, 57, of San Antonio, Texas, faces a maximum sentence of 125 years in prison after admitting to stealing nearly $109 million from a taxpayer fund.
Mello’s $3.1 million estate in Preston, Maryland. He regularly filed fraudulent paperwork and deposited grants a total of 40 times into his fake business over a six-year period, securing more than $100,000,000, court documents allege.
hThe scheme collapsed in January when IRS criminal investigators worked with Army investigators as they put together the pieces of the puzzle, and Mello was criminally charged in December 2023.
“The Department of Defense’s sloppy accounting allowed a military employee to steal $100 MILLION from taxpayers,” Grassley wrote in X.
‘It is a great shame that 4 taxpayers do not mention national security. I warned the Department of Defense about this EXACT problem 25 years ago.
“Since the Department of Defense is full of students who are slow learners and fast spenders, I sent them a letter reminding them to clean up their books.”
“In 1998 I published a staff report examining how the Department of Defense tracks incoming and outgoing money,” he added.
‘The report made clear that the Department of Defense’s internal controls are virtually non-existent, meaning manual oversight must be performed or fraud will occur.
‘The wolves come out when the taxpayer $$’s shepherds fall asleep.’
Grassley is also pushing a bill that would force the Pentagon to approve a full independent audit of the Army’s finances and penalize any component of the Defense Department that does not exceed a certain level by reducing its budget by 1 percent.
The veteran senator also sent letters to Defense Department heads requesting cooperation with his office’s investigation by the Army and the Defense Finance and Accounting Service, or DFAS, to explain how Mello’s scheme was allowed to happen.
His letters were addressed to Army Secretary Christine A. Wormuth and DFAS Director Audrey Y. Davis.
“Allowing $103.3 million of precious taxpayer money to flow freely into Mello’s personal coffers is not considered a ‘slip,'” Grassley wrote in his letter to Wormuth.
‘This is an unacceptable violation of internal controls and close oversight.
‘Those responsible should be held accountable. With weak or nonexistent internal controls, it is up to every manager and supervisor to be vigilant and alert for warning signs or irregularities.
“In my view, the magnitude of the payments to Mello’s bogus company sticks out like a sore thumb.”
Mello worked for the US Army at Fort Sam Houston in San Antonio, as a financial program manager for CYS, where he was allegedly able to transfer money to his shell company.
This is Mello’s $2.3 million property in Castle Rock, Colorado
This home was listed as one of the properties to be seized. It cost Mello $1.1 million and is in San Antonio, Texas.
Mello also owns this $870,000 home in Lakewood, Colorado. Mello had amassed a portfolio of homes in Texas, Maryland, Colorado, Washington and New Mexico, all of which prosecutors claim he purchased with the fraudulent money.
One of the sprawling mansions that brought Mello attention was this eight-bedroom, sixteen-bathroom home in Preston, Maryland, when the IRS began to question how he could afford such lavish purchases on a salary of $130,000.
A 2023 Land Rover Range Rover (file image). Transaction details show she allegedly transferred $264,874 from the account to purchase the Land Rover Range Rover last year.
Mello was seen leaving the federal courthouse in San Antonio with her husband Mark after appearing before Magistrate Judge Richard Farrer earlier this month.
He pleaded guilty to five counts of mail fraud and five counts of filing fraudulent tax returns.
Mello admitted, through a series of yes or no questions, to taking advantage of the Army’s lax controls at the Installation Management Command to steal the $108 million for a fake company he called CHYLD (Children’s Health and Safety). Lifelong Youth Development).
Albert Flores, Mello’s attorney, said after the hearing that this is the beginning of Mello taking responsibility for what he has done.
‘Today was the beginning of a long process where she pleaded guilty,’ Flores said, according to the san antonio express.
‘She is accepting responsibility for her actions. She is very sorry for what she has done.
Flores adds that Mello is collaborating with the government to recover as many stolen assets as possible.
“In the end, we expect that there will be a large amount of assets, both in number and monetary value, that will be recovered by the United States government,” he predicted.
Mello is scheduled to be sentenced before District Judge Xavier Rodríguez on May 29. She remains free on bail awaiting sentencing.