Houston man convicted of defrauding VFW


It wasn't a complicated scheme that got the 46-year-old man with a PhD in trouble. The federal government says he simply transferred money that was supposed to be used for a communication project into his own account and started spending.

Just talking about it still makes Ken Burton light up.

"Wow what a great idea, what a great project," he said.

Voice over Internet -- it doesn't seem novel now, but in 2005 on a fact-finding trip to Iraq, Burton and five others from the Texas VFW saw a need and wanted to help.

"We're in Fallujah, Kirkuk -- I mean you name it, we were there," Burton said. "The verbal communication of soldiers and their family in the field was limited. There's nothing like the sound of a spouse or your child."

So they hired Joe Nichols and his company to manage the logistics of setting up the communications system in Iraq. But not long after the VFW sent Nichols $100,000, Nichols disappeared.

"To this day, I don't know what happened," Burton said.

Instead of finishing the project, Nichols spent almost $70,000 on utility bills, car payments, credit card payments, a gym membership, a mattress, Girl Scout cookies, rent and delinquent tuition payments for his niece. According to court documents, before he transferred the money to his own bank account, he had just a penny balance.

He pleaded guilty Monday.

"He was just on had hard times with money and not excusing his conduct and he's not excusing his conduct. He did what he did, he's remorseful for it and that's why he was in court today pleading guilty to it," Nichols' attorney Jimmy Ardoin said.

Ardoin says Nichols wants to make restitution.

"How may times do you do something that it makes a difference?" Burton said.

But it's little comfort for the VFW members like Burton whose only hope was to make it easier for soldiers and their families to communicate.

"For that project to never leave the shores of the good ole US of A, it hurt," Burton said.

Nichols is out on bond until his sentencing hearing, which is scheduled for October 22. On Monday, he pleaded guilty to mail fraud and could face 20 years in prison and a possible $250,000 fine.

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