Two Minnesota National Guard members and one former soldier admitted Thursday to federal wire fraud charges in a massive National Guard recruiting scandal.
They were accused of illegally obtaining bonuses as part of a nationwide scam that plagued the military after it began a program to spur recruitment 10 years ago.
The soldiers were accused of engaging in a kickback scheme to split $2,000 bonuses with military recruiters for signing recruits.
The Minnesota cases represent a small part of the scandal, which grew out of a sharp drop in enlistments as the U.S. involvement in Iraq and Afghanistan lagged. Nationally, an Army audit and other investigations found that as much as $29 million may have been wrongly paid to people who claimed to have assisted in recruitment.
In 2005, the military contracted with a private company, Document and Packaging Brokers Inc., of Pelham, Ala., to administer a program to pay bonuses to Guard members who signed up as "recruiting assistants."
The assistants received $1,000 for each person who signed a contract to enlist and a second $1,000 when the nominee shipped out to basic training. If the nominee had prior military service, the assistant received a single $2,000 or $4,000 bonus. The program was in addition to the uniformed recruiters who work out of storefronts with no bonuses. It became rife with fraud from the start.
As part of the scam, uniformed recruiters tipped off Guard members about individuals who had expressed an interest in joining the Guard. The Guard members pretended they had made the initial contact with the recruits, submitted their names to the Alabama company, received a bonus, then split it with the uniformed recruiters. The assistants never even met the people they claimed responsibility for, the indictments said.
The bonus program was ended in 2012.
