Virginia Birth-Injury Program CFO admits to embezzling over $4.8 million
Providence Forge, Virginia – A Providence Forge man, John Hunter Raines, 38, pled guilty to embezzling over $4.8 million from his former employer, the Virginia Birth-Related Neurological Injury Compensation Program (Birth-Injury Program), during a scheme that spanned from January 2022 to October 2023. The Birth-Injury Program is a state program that provides financial compensation to families of infants who suffer severe brain or spinal cord injuries during birth, rendering them developmentally or cognitively disabled.
As Chief Financial Officer and Deputy Director of the program, Raines was entrusted with overseeing its finances, which included managing approximately $650 million in investments in 2023. However, instead of safeguarding the funds, Raines abused his position to enrich himself. According to court documents, Raines conducted at least 59 wire transactions from the program’s accounts into personal accounts, and used the program’s debit card for personal purchases.
Lavish Spending on Personal Luxuries and Gambling
Raines’s embezzlement involved extravagant spending on luxury items, gambling, and personal expenses. Court documents reveal that Raines used the stolen funds to finance a lavish lifestyle, which included:
- Purchasing numerous vehicles, including eight luxury golf carts, for more than $160,000, and a 2023 Chevrolet Suburban.
- Spending over $100,000 on gambling at locations such as Rivers Casino in Portsmouth, Colonial Downs Racetrack, and the Virginia Lottery.
- Making payments of at least $29,000 to an intimate partner, and transferring tens of thousands of dollars to his wife’s bank account.
- Spending over $9,000 on private limousine services to transport him and his guests in a Mercedes limousine to Virginia vineyards.
- Purchasing cryptocurrency, including Bitcoin and Dogecoin, and transferring funds to his brokerage accounts.
- Paying tens of thousands of dollars toward personal debts such as student loans, his mortgage, and other loans.
- Spending over $125,000 on private jet travel for himself, his family, and friends, including a trip to Nashville that cost $34,000.
- Purchasing eight 2022 1-oz American Gold Eagle Bullion coins and a 100-oz silver bar for over $19,000.
Obstruction of Audits and Program Oversight
In addition to the embezzlement, Raines took deliberate steps to hinder financial audits of the Birth-Injury Program. By failing to provide necessary files to auditors, he delayed statutorily mandated audits required by Virginia Code § 38.2-5015(B). The audits, which serve as a financial safeguard for the program, have been delayed by more than three years, in part due to Raines’ obstructive behavior.
Guilty Plea and Sentencing
Raines pleaded guilty to mail fraud and money laundering offenses. He is scheduled to be sentenced on February 27, 2025, and faces a maximum sentence of 30 years in prison. Federal sentences are generally less than the maximum penalties, as the final sentence will be determined by a federal district court judge after considering U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Jessica D. Aber for the Eastern District of Virginia, along with Inspector Damon E. Wood of the U.S. Postal Inspection Service, Special Agent Kareem A. Carter of the IRS Criminal Investigation, and State Inspector General Michael C. Westfall for 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.
