Prison for NJ man who ripped off millions from grieving military families

TRENTON — A Monmouth County U.S. Army Reserves major has been sentenced for ripping off at least two dozen grieving Gold Star families for a few million dollars collectively.

Caz Craffy, 42, of Colts Neck, would serve over 12 1/2 years in federal prison for making risky investments while working as an Army financial counselor, U.S. Attorney Philip Sellinger said.

In April, Craffy, who has also gone by the name Carz Craffey, pleaded guilty in federal court to six counts of wire fraud.

He also pleaded guilty to securities fraud, making false statements in a loan application, committing acts furthering a personal financial interest and making false statements to a federal agency.

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Pushing investments for big commissions

Despite clear rules against it, Craffy worked with two outside financial investment firms and hid that employment from the Army, Sellinger previously said.

Craffy then used his position as an Army financial counselor to target military families and encourage them to invest survivor benefits in accounts that he managed at his other jobs.

Federal prosecutors said Craffy also lied and misled the families into thinking handling their money was done with the Army’s authorization.

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When an Armed Service member dies during active duty, his or her surviving beneficiary is entitled to a $100,000 death gratuity and the soldier’s life insurance of up to $400,000.

From May 2018 through November 2022, Craffy secured more than $9.9 million from Gold Star families to invest in accounts that he managed with his illegal private position.

He used those millions to make unauthorized trades that drained families’ accounts of a collective $3.4 million — while Craffy personally raked in more than $1.4 million in commissions.

When families asked about their investments or account status, Craffy often encouraged them not to check their statements, according to his federal indictment.

"Heinous and shameless crime"

In addition to prison, Craffy was sentenced to three years of supervised release and ordered forfeiture of $1.4 million.

Craffy was already permanently banned from association with any member of FINRA — the Financial Industry Regulatory Authority, which oversees U.S. broker-dealers.

“These Gold Star families have laid the dearest sacrifice on the altar of freedom. And they deserve our utmost respect and compassion, as well as some small measure of financial security from a grateful nation. No amount of money can undo their enormous loss,” Sellinger said in a written release on Wednesday.

“Instead of offering guidance, Caz Craffy chose to defraud these heroic families,” he added, saying the term was “just punishment for this heinous and shameless crime.”

Restitution would be determined at a later date, the judge said.