Injured Soldier's Parents Charged With Stealing Son's Recovery Fund

June 10, 2010— -- A Wisconsin couple who have pleaded for help in caring for their son after he was severely injured while serving in Iraq have been charged with stealing more than $100,000 meant to finance his care and rehabilitation.

Lori and Michael Nault are accused of using at least $167,000 of their 23-year-old son's money to heavily gamble at casinos in three states and fund their own household expenses, a new truck and thousands of dollars in jewelry.

Army Specialist Shane Nault, who cannot speak and requires 24-hour care, suffered catastrophic brain injuries after an IED explosion in Iraq in May 2007. Just 23 years old, he is blind and suffered strokes.

According to court documents supporting felony theft charges for both Lori and Michael Nault, they tried to cover their tracks by listing their son's assets as $35,218 when there had actually been $254,191 deposited into nine bank accounts, many of them in Shane's name.

They face a fine of up to $25,000 and up to 10 years in prison if convicted.

A retired businessman who has given the Naults an estimated $30,000 after being touched by Shane's story said he had no idea the couple were accused of pilfering so much of their son's resources.

"What you have here is a classic scam," Robert Hytner said. "A lot of what you do is met with disappointment in charity."

By the time the district attorney's office began investigating the couple in 2008, several agencies, including the county Department of Human Services, the Veterans Administration and a bank manager, had started to question the couple's use of Shane's money.

The criminal complaint against the Naults, filed May 27, alleges they "significantly increased their lifestyle" with money meant for their son. They gambled away, according to the complaint, at least $53,000 of Shane's money and spent another $17,694 in gambling related expenses in Wisconsin, Minnesota and West Virginia in 2007 and 2008.

When confronted by a detective, the Naults admitted to making ATM withdrawals at one of the casinos, according to the complaint, but "that they believed the money designated in the account was to be used by them due to the care they provided for Shane."

Other expenses listed in the court documents paid with Shane's money include $4,100 in jewelry, along with Internet Web chat services, various household expenses and a $4,900 membership to the home furnishings company Direct Buy. There are also thousands of dollars in ATM withdrawals that were never accounted for.

In 2007, the complaint alleges, the couple used an $110,000 grant meant to be spent on Shane's care to purchase a Chevy truck in Michael Nault's name that is not equipped for transporting someone with Shane's injuries.

The complaint cited a 2008 Eau Claire Leader Telegram article reporting that Shane had received a customized van and quoting Lori Nault as complaining that it was too hard to get Shane in and out of the family's truck they had purchased.

Michael Nault declined to comment on the criminal charges against him and his wife, but told ABCNews.com that he believed the matter had been settled back in 2008 when a civil complaint led a judge to order guardianship of Shane's estate to a private company.

"Our lawyer told us not to talk to anyone about it because he would take care of it," he said, but noted that their priority remains their son. "We have always taken care of him. Me and my wife, we only have the clothes on our back."

Wisconsin Couple Has History of Financial Difficulties, Court Records Show

The Naults' attorney, Phil Steans, told ABCNews.com that the couple was "shocked" to be criminally charged in the case and they fear "that somehow they will be separated from their son."

"The horrible thing is that I believe the Naults are doing a wonderful job caring for their son," Steans said. "This is all very difficult for them."

But according to Wisconsin court records, the couple has a history of questionable financial decisions.

Lori Nault is named in a lengthy list of civil claims and judgments from hospitals, back taxes and other debts. Paperwork was filed in 2008 from the state Department of Revenue to reclaim $11,427 in deliquent taxes and interest.

In 2005, two years before Shane's injury, debt collection company Great Seneca Financial Corp. went after her for $16,580.78. That same year People's Bank of Wisconsin filed a claim against Lori Nault for $821.

After Shane was injured in Iraq, the couple was not shy about seeking donations to cover the legitimate and crippling expenses associated with caring for someone with such severe injuries.

In 2007 on a television-themed Web site reviewing ABC's "Extreme Makeover: Home Edition," Shane's sister wrote about how hard it was to raise money to pay for his care.

"No one seems to follow through on there (sic) promises, at first everyone was so concerned and always calling and helping out and now," she wrote, "only four months later, it seems everyone has forgotten."

Lori Nault wrote on a message board for the Bob Woodruff Foundation that the hardest part of the entire situation was the financial aspect.

"We have no means of compensation for caring for him. Something is wrong with this picture," she wrote. "The government will pay a nursing home to care for our son but they will not supplement us in any way. The hardship is incredible, but don't get me wrong we would do nothing different."

The Woodruff Foundation, founded up by ABC News' correspondent Bob Woodruff, critically injured himself while in Iraq in 2006, confirmed that the non-profit typically does not deal with individual donations and that no money was paid to the Naults.

Businessman Donated Money, Didn't Know Parents Hitting the Casinos

Hytner said he first met the Naults in 2007 when he was visiting wounded soldiers in Bethesda, Md., something he does with regularity. Michael Nault told him he'd had to quit his job to care for Shane and that Lori Nault had multiple sclerosis.

Hytner said their story touched a nerve and he wrote a check for $10,000 on the spot. He would give them another $20,000 in the coming months after Michael Nault told him their expenses in caring for Shane ran about $5,000 a month.

Then, about 18 months ago, Hytner said he got a call from detectives asking about the Naults. Hytner said he was led to believe they had gambled away only a small amount of money and he wasn't too concerned.

"Frankly I didn't care if they spent $1,000 at a casino because if my kid looked like Shane I'd probably go to a casino too," he said. But he was surprised to hear that the parents were accused of gambling tens of thousands more than that.

Michael Nault called Hytner about eight months ago "saying they were in trouble and they could use some more money. After receiving the call from the detective, I didn't return his call," Hytner said.

"The sad part of this ... is you have this young man who sacrificed all but his life," he said.

Though Michael Nault refused to talk about his time in the casinos, he told ABCNews.com that Shane is "doing fantastic" and has started to take steps with assistance.

In an online article posted on the Paralyzed Veterans of America, Lori Nault said the transition from full-time workers to caregivers dependent on the financial help of others was "demeaning" but that putting their son in a nursing facility was out of the question.

"We truly have no life to ourselves any longer," she told the Web site. "Our life revolves around Shane and what is best for him."

"We actually have had people think that we have it so easy because we don't have to work anymore," Lori Nault continued. "I would love for them to live in our shoes for a day. I wouldn't wish this on anyone."