Former Army Employee with 'Penchant for Extravagance' Stole $108 Million Intended for Military Children

A Texas woman formerly employed by the U.S. Army in a civilian role was sentenced to 15 years in prison for stealing more than $108 million in funds intended to support military children, authorities said.

Janet Yamanaka Mello, 57, was sentenced to 180 months in prison for five counts of mail fraud and five counts of filing a false tax return, the U.S. Attorney's Office for the Western District of Texas announced.

From December 2016 through at least August 29, 2023, while Mello was employed as a financial program manager for the U.S. Army's Morale, Welfare and Recreation program and Child and Youth Services (CYS) program at Fort Sam Houston, she created a business called Child Health and Youth Lifelong Development (CHYLD).

The "sole purpose" of Mello's business was to receive grant money from the 4-H Military Partnership Grant program, which it received fraudulently as a result of her position as a CYS program manager.

According to court documents, Mello's business received 49 grant checks during the six-year-period, worth approximately $108,917,749.

She deposited the checks into her bank account and spent the money on clothing, jewelry, dozens of vehicles and luxury real estate.

“Janet Mello betrayed the trust of the government agency she served and repeatedly lied in an effort to enrich herself,” U.S. Attorney Jaime Esparza said in a statement. “Rather than $109 million in federal funds going to the care of military children throughout the world, she selfishly stole that money to buy extravagant houses, more than 80 vehicles and over 1,500 pieces of jewelry. Her actions reflect exactly the opposite of what it means to serve your country, and my office will continue to work tirelessly to prosecute those who illegally seek personal gain at the expense of their fellow citizens.”

“Corruption and fraud in U.S. Army programs jeopardize the safety and security of our Soldiers and their families. When discovered, fraudulent activities by Army employees will not be tolerated, and those involved will be brought to justice,” said Special Agent in Charge Maria Thomas for the Department of the Army Criminal Investigation Division, Central Texas Field Office. “The Army community, and the public, can rest assured that we remain committed to aggressively pursuing anyone that uses government programs for their own personal gain.”

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Mello also failed to claim millions of dollars in fraudulently obtained income during tax years 2017, 2019, 2020, 2021 and 2022.

"Mello's penchant for extravagance is what brought her down. We identified that her reported income was well below the lavish lifestyle she lived. As we uncovered the details, the criminal scheme grew, the dollar amount grew, and the reach of her spending grew," said Acting Special Agent in Charge Lucy Tan of IRS Criminal Investigation's Houston Field Office. "Financial crimes have victims, and this one took opportunities away from the children and families of our military men and women.”

TMX contributed to this report.