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Press Release

Mascoutah, Illinois, Woman Sentenced to 18 Months in Prison for Mail Fraud

For Immediate Release
U.S. Attorney's Office, Central District of Illinois

SPRINGFIELD, Ill. – A Mascoutah, Illinois, woman, Paula Klaustermeier, 56, of the 900 block of West South Street, was sentenced on November 2, 2022, to 18 months in federal prison for committing three counts of mail fraud. Klaustermeier also was ordered to pay $137,363.47 in restitution to the United States Department of Labor.

At the sentencing hearing, the government presented evidence that beginning in November 2006 and extending until January 2013, Klaustermeier regularly and systematically defrauded the United States Department of Labor, Office of Worker’s Compensation Program (OWCP), by submitting modified and wholly fabricated medical records, as well as over 1,500 fraudulent reimbursement claims for traveling to medical appointments. Among other fraudulent assertions, Klaustermeier claimed she was traveling almost daily to YMCA facilities for medical treatment reasons. These were facilities, however, to which she did not belong and which she did not visit. For at least 950 of the claims, she stated she was attending warm water therapy at a YMCA in Belleville, Illinois; however, the address she supplied for the YMCA for reimbursement purposes was her parents’ residence.

At the hearing, U.S. District Judge Sue E. Myerscough determined Klaustermeier defrauded the government out of $137,363.47 by submitting fraudulent medical and travel benefit claims. Judge Myerscough noted Klaustermeier had taken money that could have been provided to other individuals in need and that she had refused, at each and every turn, to take any responsibility for her actions.

On January 3, 2017, a grand jury returned an indictment charging Klaustermeier with three counts of mail fraud, in violation of 18 U.S.C. § 1341. On March 6, 2020, following a trial, the jury returned guilty verdicts as to each of the three counts of mail fraud.

The statutory penalties for mail fraud are not more than 20 years in prison, not more than three years of supervised release, and up to a $250,000 fine.

“Paula Klaustermeier fraudulently obtained more than $56,000 in FECA benefits by submitting hundreds of false travel reimbursement requests to OWCP, claiming she completed aquatic therapy sessions at numerous medical facilities, including a non-existent therapy center at her parents’ house, when she did not do so.  Today’s sentencing affirms the U.S. Department of Labor, Office of Inspector General’s commitment to working with our law enforcement partners and OWCP to protect the integrity of DOL’s benefit programs,” said Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor, Office of Inspector General.

The Office of the Inspector General for the Department of Labor and the U.S. Postal Inspection Service investigated the case. Assistant U.S. Attorney Tanner K. Jacobs represented the government in the prosecution.

Updated November 3, 2022