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Press Release

Disbarred Attorney Sentenced To 51 Months In Prison For Stealing 9/11 Victim Compensation Funds

For Immediate Release
U.S. Attorney's Office, Southern District of New York

Audrey Strauss, United States Attorney for the Southern District of New York, announced that GUSTAVO L. VILA, a disbarred lawyer in New York, was sentenced today in White Plains federal court to 51 months in prison for stealing approximately $1 million that the Department of Justice’s 9/11 Victim Compensation Fund (“VCF”) had awarded to VILA’s client, a 9/11 first responder.  VILA pled guilty on October 29, 2020, before U.S. District Judge Vincent L. Briccetti, who also imposed today’s sentence.

U.S. Attorney Audrey Strauss said:  “Gustavo Vila stole money awarded by the 9/11 Victim Compensation Fund to his client, an NYPD officer and 9/11 first responder.  Further, Vila lied to his client for more than three years, telling him that the stolen money had yet to be released by the Fund.  Now Gustavo Vila has been sentenced to prison for his betrayal.”

According to the Complaint, the Information, and other court filings and statements made in open court:

In the wake of the September 11 terrorist attacks, Congress created the VCF to provide compensation with federal government funds to any individual who suffered physical harm or was killed as a result of the terrorist attacks, or as a result of the debris removal efforts that took place in the immediate aftermath of those attacks.  The original VCF operated from 2001 to 2004.  President Obama and President Trump reactivated the VCF, authorizing it to operate through October 2016, and December 2020, respectively.  Claimants seeking compensation from the VCF were authorized to work with an attorney and have the attorney, on the claimant’s behalf, submit a claim to, and receive the claimant’s award from, the VCF.  An attorney’s fees were limited to 10% of a VCF award.

From at least in or about 2012 through at least in or about 2019, VILA represented a retired New York City Police Department officer (“Victim-1”) in connection with Victim-1’s claim for compensation from VCF.  Victim-1 was diagnosed with, and suffered from, serious, life-threatening medical conditions, including cancer, as a result of rescue and recovery work he performed at Ground Zero.  Throughout his representation of Victim-1, VILA held himself out as an attorney to Victim-1 and to the VCF, despite the fact that in 2015, VILA was disbarred, after being convicted in Westchester County Supreme Court of grand larceny in the third degree, a felony, for stealing funds from another client.  

Despite his disbarment, VILA continued to hold himself out as an attorney to Victim-1 and to the VCF and to represent Victim-1 in connection with his VCF claim.  Victim-1, on VILA’s advice, authorized the VCF to deposit any money it awarded Victim-1 directly into VILA’s bank account.  On or about September 13, 2016, the VCF authorized an award to Victim-1 of $1,030,622.04 for life-threatening illnesses Victim-1 had sustained from rescue and recovery work he performed as a police officer at Ground Zero.  On or about October 12, 2016, the VCF deposited the full amount of Victim-1’s award – mover $1 million – into VILA’s bank account.  At that point, VILA was required to distribute all of that money, less 10 percent for his purported attorney’s fees, to Victim-1.  VILA, however, represented to Victim-1 that the VCF had only released 10 percent of the award, that is, approximately $103,062, which VILA sent Victim-1 on or about October 26, 2016.  That is the only portion of the award that Victim-1 ever received.  VILA stole the remaining 90 percent of the award – approximately $927,559.84 – and used those funds for his own personal benefit, including to pay his own taxes and personal loans.  Over the next three-plus years, VILA continued to lie to Victim-1, repeatedly telling Victim-1 and his family that the VCF had not yet released the full amount of the award, when in fact, the entire award had been released for Victim-1’s benefit in October 2016. 

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VILA, 62, of Yorktown Heights, New York, pled guilty to, and was sentenced on, one count of theft of government funds, in violation of Title 18, United States Code, Section 641.  In addition to the 51-month prison term, VILA was sentenced to three years of supervised release and was ordered to forfeit $922,559.84, and to pay restitution to Victim-1 in the amount of $867,870.76.

Ms. Strauss praised the outstanding investigative work of the U.S. Department of Justice Office of the Inspector General's Fraud Detection Office. 

The prosecution of this case is being handled by the Office’s General Crimes Unit.  Assistant United States Attorney Sarah L. Kushner is in charge of the prosecution.


James Margolin, Nicholas Biase
(212) 637-2600

Updated April 19, 2021

Financial Fraud
Press Release Number: 21-089