Trajector Medical, a Florida company, is the subject of ongoing investigations by state attorneys general in New York and Illinois regarding allegations of fraudulent and deceptive business practices targeting military veterans. The company charges veterans as much as $20,000 for assistance with disability claims, despite federal law requiring that initial disability claim assistance be provided at no cost by accredited providers. The state investigations were revealed in a Sept. 8 letter to the U.S. Bankruptcy Court in Florida, where officials stated they intend to pursue legal action and believe money held by the company was collected through illegal and fraudulent means.
According to reporting by NPR, Trajector uses an automated system called “CallBot” to access Veterans Affairs benefits hotlines by entering veterans’ social security numbers, ostensibly to monitor changes in their benefit payments. The company then bills veterans based on information obtained through this system, including cases where no assistance was actually provided. The automated dialing system and potential misuse of personal information gathered from veterans are specific focuses of the state investigations. The company has denied all allegations and stated it stands behind its operations and commitment to serving veterans.
Traject Medical, along with 21 affiliated companies, filed for Chapter 11 bankruptcy protection five days before facing a default on a loan of nearly $63 million owed to Deutsche Bank. The bankruptcy filing consolidated the company’s operations and placed civil lawsuits on hold. Bankruptcy records indicate the entities employ over 450 staff members and hold approximately $405 million in assets, with combined income of nearly $280 million in 2025. However, state authorities contend that funds held by the company were obtained illegally and should not be considered estate property available for creditor repayment.
While the Chapter 11 filing temporarily halted civil litigation brought by veterans’ attorneys, it does not prevent state law enforcement investigations from proceeding. Legal experts note that even with fraud allegations, bankruptcy procedures typically do not provide special priority status for defrauded parties, meaning veterans may be treated as standard creditors in any distribution of company assets.
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