Prosecutors convicted a New Jersey woman and her husband of fraudulently obtaining more than $1.6 million in federal funds through a nationwide scheme that used stolen identities, fabricated records and a shell company that never provided the services it claimed to offer.
A jury in Utica, New York, found Jael Watts, 45, of Alloway, New Jersey, and Luis Pino-Copete, 42, of Bogota, Colombia, guilty after a trial that lasted several weeks, according to the U.S. Department of Justice.
Prosecutors said the couple operated Pearl Transit Corporation, a shell company that claimed to provide transportation for elderly and disabled people and outreach services for homeless Americans.
Investigators found that Pearl Transit had no drivers providing the advertised services. Instead, Watts and Pino-Copete used real people’s identities to fabricate customer lists, employment records, and billing documents, making it appear that the company had performed services eligible for federal reimbursement, according to prosecutors.
The scheme operated from July 2019 through October 2025, during which Watts and Pino-Copete sought more than $13 million in federal funding through fraudulent claims. Prosecutors said they ultimately obtained more than $1.6 million and used the money to pay for luxury goods, travel, and other personal expenses.
“It was all fake. Ghost riders, ghost drivers, no services provided. They used names and personal details from real people,” Colin McDonald, assistant attorney general for the Justice Department’s National Fraud Enforcement Division, said. “People who had no idea any of this was happening and then copied that information into made-up records.”
The federal programs aimed to help people who often rely on public assistance to meet their basic needs. Prosecutors said the couple submitted claims tied to transportation and housing programs administered through the U.S. Department of Transportation and the Department of Housing and Urban Development.
The investigation began in late 2024, when Watts submitted nearly $750,000 in reimbursement requests to the New York State Department of Transportation. The New York State Comptroller’s Office flagged the invoices as suspicious, prompting an audit.
When investigators questioned the claims, the couple generated additional documents using stolen identities in an effort to convince officials that Pearl Transit had performed the work, according to the Justice Department. The audit eventually drew in federal investigators, including officials from the transportation and housing departments’ inspector general offices.
New York State Comptroller Thomas DiNapoli said investigators reviewed financial records and interviewed Watts as they worked to uncover the scope of the scheme.
“The more we sifted through the defendants’ attempts to legitimize their operation, the more their scheme fell apart,” DiNapoli said.
The government said some of the people listed as Pearl Transit customers had died before the company claimed to have transported them. Others named as drivers did not hold driver’s licenses and had never driven a car.
Prosecutors also uncovered an unusual element of the scheme involving dental services. Watts and Pino-Copete sought federal reimbursements by claiming they provided dental prostheses to homeless people.
However, according to the Justice Department, they instead used an unsanitary 3D printer at home to produce dentures and charged clients experiencing homelessness for mouth scans and fittings.
The investigation also traced the funds to personal spending, including more than $100,000 in Porsche rentals and over $100,000 in purchases at Loro Piana, a luxury clothing retailer in Manhattan. Prosecutors said the couple also embarked on an extended travel spree in 2024, visiting Colombia and Aruba before spending several months in Europe.
Photographs presented during the case showed Watts and Pino-Copete traveling together, including selfies taken at a Tuscan spa and during a visit to a BMW plant. Other images documented their alleged efforts to submit fraudulent paperwork to obtain additional funding. The photographs, along with records of their relationship, highlighted their close ties as prosecutors alleged they worked together to carry out the scheme.
Watts married Pino-Copete in Colombia in 2023, and the Justice Department said he joined the scheme the following year. He entered the United States on a visa in January 2025, according to the federal announcement. Investigators said a review of the couple’s phones uncovered extensive communications about creating false documents to address questions raised during the state audit.
In one message cited by prosecutors, Watts wrote, “One has to be committed to this type of work…and I am committed.” She also boasted, “They are not smart…we are much smarter.”
The jury convicted both defendants of wire fraud conspiracy, making a false document, and aggravated identity theft. A jury also convicted Watts of making a false statement and five counts of wire fraud.
Federal officials said the case illustrates how fraudulent claims can divert money from people who rely on public programs. Shawn Rice, a special agent in charge with HUD’s Office of Inspector General, said the defendants’ actions deprived vulnerable communities of resources intended for their benefit.
“This is not a victimless crime,” Rice said. “Every dollar they stole could have been used to help vulnerable Americans.”
First Assistant U.S. Attorney John Sarcone also emphasized that authorities would pursue people who misuse public funds. “No matter how big or small the fraud is, we’re going to get you,” Sarcone said.
The court scheduled Watts and Pino-Copete’s sentencing for Jan. 21, 2027. Each faces a mandatory minimum sentence of two years in prison and a maximum of 20 years, along with fines of up to $250,000 and up to three years of supervised release. The court may also order them to pay at least $1.9 million in restitution.
Pino-Copete, who is not a U.S. citizen, also faces possible removal from the country after completing any prison sentence, according to the Justice Department.
