White Supremacist Pleads Guilty in Veterans Affairs Pension Case

COLUMBIA, SC—United States Attorney Bill Nettles stated today that August Byron Kreis III, age 56, formerly of Lexington County, South Carolina, pled guilty today in federal court to submitting a pension eligibility report to the United States Department of Veterans Affairs (VA) that falsely claimed that he had no income, a violation of Title 18, United States Code, Section 1001. As a result of his guilty plea, Kreis faces a maximum penalty of five years’ imprisonment and $250,000 fine. United States District Judge Joseph F. Anderson, Jr., will impose sentence after he has reviewed a presentence report which will be prepared by the U.S. Probation Office.

Facts presented during the guilty plea and at an earlier bond hearing established that Kreis was receiving an “Improved Pension” as a result of his nine-month service in the United States Navy. Despite his brief service and discharge based on a determination that he was not suited for military service, Kreis qualified for this pension because he served during war time. The Improved Pension is based on need, and all recipients are required to report all income from any source. The VA then reduces pension benefits on a dollar-for-dollar basis for any qualifying income. It also uses reported income to determine continued eligibility.

Kreis has been a national leader in the Aryan Nations White Supremacist movement, and he has publicly stated his belief that the United States government was behind the events of September 11, 2001. As a leader of the white supremacist movement, Kreis was sought out by national media for comments during the 10th anniversary of the Oklahoma City bombing. During an interview that was broadcast on national television, Kreis stated that he and members of his movement desired to join al-Qaida in its Jihad against the United States government. Actions in material support of enemies of the government are criminal, and federal law enforcement investigated whether Kreis was acting on these statements or providing support to al Qaeda.

Financial records from Kreis’ bank accounts were obtained and analyzed. They did not show support for the enemy, but they did reveal that he had substantial unreported funds going into his bank accounts. During 2005, for example, Kreis received approximately $33,669 from sources other than the VA, and he failed to report any of the money. Furthermore, in an eligibility report that he submitted to the VA on August 29, 2006, Kreis stated that during 2005, he had no income from any source. This false report formed the basis for the crime to which Kreis pleaded guilty.

The case was investigated by agents of the Federal Bureau of Investigation and the United States Department of Veterans Affairs, Office of Inspector General, Office of Investigations. Assistant United States Attorney Dean A. Eichelberger is handling the case.