Date: Oct. 8, 2024 Contact: newsroom@ci.irs.gov Richmond, VA — A Providence Forge man pled guilty today to embezzling funds from his former employer, the Virginia Birth-Related Neurological Injury Compensation Program (Birth-Injury Program). According to court documents, John Hunter Raines was the chief financial officer and deputy director of the Birth-Injury Program. The Birth-Injury Program pays monetary compensation to families of infants who suffer from brain or spinal cord injuries resulting from the birth process that render the infant developmentally and/or cognitively disabled. Raines’ role required that he oversee the finances of the Birth-Injury Program, including approximately $650 million in investments in 2023. From at least January 2022 through October 2023, Raines stole over $4.8 million from the Birth-Injury Program, including by using his access to the Birth-Injury Program bank account to initiate at least 59 separate wire transactions, sending funds to bank accounts in Raines’ own name. Raines also used the Birth-Injury Program debit card for personal gain. Raines spent embezzled Birth-Injury Program money on various personal expenses. For example: Raines purchased numerous vehicles, including eight luxury golf carts for over $160,000 and a 2023 Chevrolet Suburban; Raines spent over $100,000 on gambling, including at Rivers Casino in Portsmouth, Virginia, Colonial Downs Racetrack in New Kent, Virginia, and the Virginia Lottery; Raines paid at least $29,000 to an intimate partner and tens of thousands of dollars to a bank account in the name of Raines’ wife; Raines spent over $9,000 on private limousine services, including to chauffer Raines and his guests in a Mercedes limousine from Raines’ house to Virginia vineyards; Raines made numerous purchases of cryptocurrency, including Bitcoin and Dogecoin, and transferred funds to his brokerage accounts; Raines paid tens of thousands of dollars towards his student loan debt, his mortgage, and other loans; Raines paid over $125,000 for private jet travel for Raines’ friends and family. As an example, Raines paid over $34,000 to travel with his wife and his friends to Nashville, Tennessee, for three days in a private jet; and Raines spent over $19,000 to purchase eight separate 2022 1-oz American Gold Eagle Bullion coins and a 100-oz silver bar. As a financial control on the Birth-Injury Program, Virginia Code § 38.2-5015(B) required an independent certified public accountant selected by the Birth-Injury Program’s board of directors to complete an audit of the program's accounts each fiscal year. Raines deliberately impeded the statutorily mandated audit process by failing to timely provide the Birth-Injury Program’s files to auditors when requested. Due at least in part to Raines’ obstructive conduct, the Birth-Injury Program’s statutorily mandated audits continue to be delayed by over three years. Raines pled guilty to mail fraud and money laundering offenses. He is scheduled to be sentenced on Feb. 27, 2025, and faces a maximum penalty of 30 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Kareem A. Carter, Internal Revenue Service Criminal Investigation (IRS-CI) Special Agent in Charge of the Washington D.C. Field Office; Damon E. Wood, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; and Michael C. Westfall, State Inspector General for the Commonwealth of Virginia, made the announcement after Senior U.S. District Judge John A. Gibney Jr. accepted the plea. Assistant U.S. Attorneys Avi Panth and Kashan K. Pathan are prosecuting the case. IRS-CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. IRS-CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.
