Laclede man pleads guilty to VA fraud

SANDPOINT — A Bonner County man accused of faking paraplegia to obtain Veterans Affairs benefits has pleaded guilty, the U.S. Department of Justice announced on Monday.

James M. Sebero pleaded guilty to one count of wire fraud and one count of making false statements in a case federal prosecutors say is the largest single instance of disability compensation benefits fraud in VA history.

James McDevitt, U.S. Attorney for the Eastern District of Washington, said the successful resolution of the case was due to the cooperative efforts of U.S. Attorney’s Office for the District of Idaho, Office of the Inspector General and the VA.

“By his actions, Mr. Sebero disgraced the system that compensates all those veterans who are truly disabled and who are fairly compensated for their injuries sustained in service to their country,” McDevitt said in a statement.

Sebero, a 59-year-old Laclede resident, was facing 55 counts of wire fraud in Idaho and three counts of making false statements in Washington state, according to U.S. District Court documents.

The Idaho indictment alleged Sebero received approximately $1.5 million in VA by claiming he lost the use of his legs while enlisted in the U.S. Air Force.

Federal prosecutors said Sebero served from 1969 until 1975, when he advised Air Force personnel he had been injured while unloading a snowmobile.

Compensation benefits from the VA began flowing in 1976. Almost immediately after the receiving his medical retirement and VA benefits, Sebero established an excavation business and later an aircraft maintenance business called Custom Aviation, Justice Department officials said.

Sebero also obtained a pilot’s license and other certifications which made no mention of his alleged disability. He was also hired as an able-bodied deputy for the Bonner County Sheriff’s marine patrol.

Sebero’s scheme unraveled two years ago, when he was investigated for making false statements to the Federal Aviation Administration.

On Sept. 26, 2007, prosecutors said Sebero entered the VA hospital in a wheelchair for an examination. The following day, federal agents spotted Sebero walking into Spokane’s federal courthouse, where he negotiated staircases and stood without assistance.

A plea agreement in Sebero’s case requires him to forfeit unspecified assets and pay $950,000 in restitution, federal officials said.