Luxury items, vehicles seized; San Antonio woman accused of stealing $100 million from military

A federal grand jury has indicted a former civilian government worker on charges that she stole more than $100 million intended for a 4-H program for children of military families.

Janet Yamanaka Mello, 57, has been under investigation for months over billings related to a business she controlled called Child Health and Youth Lifelong Development (CHYLD).

Mello claimed that CHYLD provided 4-H services to military personnel and their families, but federal authorities say the company was a shell she used to illegally divert government money. 

The indictment, released Wednesday, alleges that Mello used the funds to buy millions of dollars worth of jewelry, clothing, luxury accessories, high-end vehicles and real estate.

Mello is also accused of falsifying the digital signature of a supervisor on numerous occasions as part of the scheme.

She is charged with five counts of mail fraud, four counts of engaging in a monetary transaction over $10,000 using ill-gotten proceeds, and one count of aggravated identity theft.

Mello could not be reached for comment. She has unlisted residential and cellphone numbers, and other phone numbers listed for her and her husband are no longer active.

Mello’s first court appearance is scheduled for Dec. 14 in San Antonio’s federal courthouse.

How alleged scheme worked

She worked for the Army at Joint Base San Antonio-Fort Sam Houston as a civilian Child and Youth Services financial program manager. Her duties included working with the 4-H Military Partnership Grant program.

The program is funded by the Army, Navy and Air Force. Kansas State University administers the program through 4-H military liaisons and land-grant universities, which provide training and curricula to the service branches so that children from military families can participate in 4-H, a network of youth groups that encourages children to undertake hands-on projects in agriculture, health, science and civic leadership.

Part of Mello’s job was to determine how much money was available for the organizations that applied to participate in the program. Her supervisors approved the grants. Grant award packages, which included a memo signed by Mello, were then sent to the Defense Financial Accounting Service (DFAS) with instructions to cut checks to successful applicants.

DFAS would then mail the checks to the organizations.

Mello formed CHYLD in 2016, though she remained a government employee. The indictment states that Mello formed the company solely to carry out her scheme to bilk the 4-H program. 

She used her government position, and the trust her supervisors placed in her, to her advantage, the indictment alleges. 

Mello allegedly filed fraudulent paperwork for grant awards, and DFAS sent checks in amounts she requested to a UPS Store mailbox that she rented in the San Antonio area. Once Mello collected the checks, she deposited them in a bank account she controlled, the indictment said.

She went through that process more than 40 times during a six-year period, collecting more than $100 million, the indictment said.

Luxury accessories, vehicles, properties seized

Federal agents in late August raided her home at 4051 Fossil Forest in a gated community off of TPC Parkway on the far North Side. They seized Louis Vuitton purses and other luxury-brand accessories, and several of the high-end vehicles that Mello and her husband, who is not charged, bought, including a 2023 Range Rover, the indictment shows.

In late August, the U.S. Attorney’s Office in San Antonio filed a pair of forfeiture lawsuits, a civil tool used to seize suspected proceeds of a crime, against a bank account tied to Mello and four real-estate properties owned by Mello and her husband.

The forfeiture lawsuits cite violations of the federal money-laundering statute as support for seeking to seize homes and other properties owned by the couple.

One of the lawsuits was filed against a Bank of America account in the name of Janet Mello. In September, a court filing said agents found it had a balance of $209,892 when it was frozen.

The second suit targets several properties: the Mellos’ primary home on Fossil Forest, which property records show is worth more than $1.1 million; 4.4 acres of land on FM 3159 near Canyon Lake, worth about $600,000; and another 153 acres on FM 3159 in Comal County, worth nearly $3.5 million.

That suit also targets a large estate in rural Preston, Md., worth $3.1 million, that the Mellos bought in early August. A property listing said the estate sits on about 60 acres and the main house is 9,364 square feet, with eight bedrooms and 16 bathrooms. Besides garages attached to the main house, it also has a separate building with at least 7 garages for car enthusiasts.

The previous owners said they sold the Maryland home on Aug. 7 to the Mellos. In an interview, the sellers’ lawyer, Tim Wilson, said the Mellos bought the home after responding to a listing for the estate.

Wilson said his clients had no ownership interest in the property after the sale “went 100% through.”

“All of our interactions with them were through our realtor,” Wilson said. “They came and toured the property with a realtor. They put in an offer and we accepted.”

Wilson said his clients’ realtor was told that Janet Mello “had some connection to the East Coast, a government or consulting job.”

The sellers’ realtor “Googled them” beforehand, but found little information about the couple, Wilson said. The Mellos told the realtor they’d hired someone to limit information about on the internet. 

“It was a conscious effort on their part to (limit) what (results) would come up,” Wilson said.

In June 2012, under her maiden name of Janet Yamanaka, she filed for Chapter 13 bankruptcy, which gave her up to five years to pay some of her debts. 

At the time, she was earning between $100,000 and $150,000 per year at her government job, her filings show. She was a widow at the time; her then-husband, Manuel Taitano Jr., died in 2009.

At the time of the bankruptcy, she was a program specialist in the children and youth division of the Defense Finance and Accounting Service, which handles pay services for the Navy and Marine Corps active-duty service members and reservists.

In her pleadings, she listed $101,868 in assets and $130,847 in liabilities.

A payment and discharge plan was approved in August 2012, and a bankruptcy trustee submitted a court filing in July 2017 saying Yamanaka (Mello) had made all her payments under the 2012 plan.

A bankruptcy judge discharged her case in August 2017.

A month later, on Sept. 5, 2017, she and her current husband picked up their marriage licenses in her native Guam, the Pacific Daily News reported. It was not clear when they began dating.

They soon began a series of real estate acquisitions, amassing the properties the federal authorities want to seize, as well as a portfolio of others, each worth hundreds of thousands of dollars.

The portfolio includes land on Verde Mountain Trail (in both Bexar and Comal counties) valued at $1.74 million; land acquired in June 2018 on Ware Seguin Road in Schertz, valued at $500,000; and two vacant properties on Graytown Road in Schertz, valued at more than $320,000, that they acquired in March 2018.

Property records show they also own a condo worth nearly $535,000 in Horseshoe Bay in Central Texas, which property records show they acquired in October 2018. They own another two condos at The Waters at Horseshoe Bay, one of which is valued at nearly $291,510 and other $726,000.

Records show they own eight other parcels of Horseshoe Bay land worth a total of $784,900, acquired between 2018 and 2020, records show.

In July 2018, they bought a home in Lacey, Wash., for $445,000. It is now worth $644,000, property records show.

Also, records show they also purchased a large home in Castle Rock, Colo., in October 2022. The property listing put the sales price at $2.3 million and described Brazilian cherry floors, Viking appliance outdoor kitchen and Thermador appliances in the inside kitchen inside. The 6,756-square-foot house, with four bedrooms and six baths, is located near Denver.

If convicted of bilking the government, Mello faces a maximum penalty of 20 years in prison for each fraud charge, up to 10 years for each charge related to spending ill-gotten funds, and a mandatory minimum of two years for the aggravated identity theft charge.