An Encampment, Wyoming, woman has been found guilty of scamming welfare agencies out of thousands of dollars by running a yearslong scheme in which she pretended to live apart from her husband and on virtually no income.
Her husband also has been convicted for helping to delude welfare agents.
Sarah Fitzwater, who turns 43 this year, and her husband Matthew Wagy, who turns 41 this year, are set for a June 21 sentencing hearing.
Carbon County District Court Judge Dawnessa Snyder convicted them both last month after a four-day trial by judge.
Snyder found Fitzwater guilty of 18 of the original 19 allegations of welfare fraud Carbon County Attorney Sarah Chavez Harkins charged her with last June. And the judge found Wagy guilty of nine welfare fraud charges for his role in the scheme.
Felony welfare fraud is punishable by up to 10 years in prison and $10,000 in fines, per count.
The court dropped one count against Fitzwater, which had accused her of committing Medicaid fraud throughout the year 2018.
The original charging documents say the pair were overpaid by $44,996.55 across various welfare programs, though the final fraud total is at least $500 less than that without the now-dropped Medicaid charge.
Investigators caught the pair by perusing Facebook posts about their wedding in Cabo, Mexico, their marriage, their generous donations to the local Little League, and by combing through their voter registrations and other forms, court documents say.
‘True And Correct’
Fitzwater and Wagy have three children and have lived in Saratoga and Encampment, according to an evidentiary affidavit by Department of Family Services eligibility investigator Dawn Royal, filed June 22, 2023.
Fitzwater applied to the Rawlins Department of Family Services field office numerous times for public assistance between July 2017 and November 2022, the affidavit says.
These applications included pleas for help from the Supplemental Nutrition Assistance Program (SNAP, formerly known as food stamps), the Low-Income Energy Assistance Program (LIEAP) and Medicaid benefits.
The applications are laced with warnings.
“For each benefit, the applicant must certify on an application that the foregoing information is true and correct and subject to perjury penalties,” says the affidavit.
Those applying must report all household members, any earned or unearned household income, shelter expenses and assets.
‘I’m With My Husband’
When Fitzwater applied for help July 12, 2017, she wrote that she and her three children lived in a Saratoga home, that no household members were employed and that she received $888 per month in child support, the affidavit says.
Fitzwater listed no employment income.
Wagy sent the Rawlins DFS field office a handwritten note that week testifying that he paid Fitzwater’s rent and cellphone bill.
Fitzwater wrote on the note that she paid her own car payment, trash and electric bills.
A benefit specialist called Fitzwater for a follow-up interview, which the affidavit says is part of the application process.
“I’m with my husband, we are driving so I might lose you,” said Fitzwater during the interview, reportedly.
In-Kind Labor
The same ruse persisted, with Fitzwater sending in numerous applications over the course of the next five years, and Wagy attesting in writing that he paid her bills for her.
Her reported child support jumped to $1,052 per month for most of that time period. At one point she attested that she paid her rent to Wagy with “in-kind” labor and that he was her landlord.
The benefit specialist asked Fitzwater in late 2017 how she managed to pay all her bills and still survive.
“Oh, my credit is really good, and I have a credit card that I can use for anything,” relates the affidavit from that interview.
Sometimes Fitzwater would report that she was earning $800 a month by working for a motel.
House In His Name
On Feb. 19, a benefit specialist interviewed Fitzwater, and the latter said she and Wagy had refinanced their home and put it in his name, but she said he still did not live with them.
That summer Fitzwater applied for benefits using a new physical address, in Encampment.
She told the benefit specialist that Wagy bought the Encampment house and paid for it free and clear because it was so cheap, says the affidavit. She said she lived there with their children and paid nothing for rent or utilities; while Wagy paid the water bill.
Again, she said Wagy did not live there, the document says.
Wedding In Cabo
Fitzwater kept applying for and receiving benefits through Nov. 29, 2022.
But agents were investigating and gathering “collateral evidence” to check Fitzwater’s statements.
Investigators took particular notice of a June 8, 2015, Facebook post by another woman, featuring photographs and captions of Wagy and Fitzwater’s wedding in Cabo, Mexico.
Investigators perused Facebook more.
A profile named Sarah Wagy posted a statement of gratitude Sept. 19, 2020, writing:
“So I’m going to brag on my life… And I wanna thank my absolutely amazing Hubby Matthew Wagy for busting you’re a** and giving us the most amazing life imaginable I’m the luckiest woman alive!!!”
The Platte Valley Little League reportedly published June 28, 2021, a statement that read:
“We will also have hot dogs, chips and drinks thanks to a generous donation from the Wagy family! Thank you, Matthew Wagy and Sarah Wagy!”
On Sept. 9, 2022, Fitzwater posted pictures on Facebook showing the family vacationing in Tennessee.
Voter Registration
Investigators also noticed that Fitzwater and Wagy completed voter registrations for the November 2016 election in which they both changed their addresses from the same Saratoga address to the same Encampment address.
Wagy completed a W-4 employee form Aug. 5, 2019, listing his address as the Saratoga home in which Fitzwater lived.
He completed a workplace insurance enrollment form that same day listing Fitzwater as his spouse.
Many other of Wagy’s various registrations and forms gave the same addresses (Saratoga early on, Encampment later) that Fitzwater claimed on her welfare applications and other documents.
School registration forms for the pair’s children listed them as living with both parents, the affidavit says.
Living In A Trailer
Royal interviewed Matthew Wagy on Oct. 20, 2022.
Wagy admitted he signed Fitzwater’s notes about paying her monthly expenses, and admitted he lived at the same Encampment address as she.
But he said he stayed in a trailer parked in his shop, the affidavit says.
Royal obtained a picture in early 2023 of the family’s new car.
The pair are awaiting sentencing outside the jail, as Snyder placed them both on an “own recognizance” bond, which is essentially a promise to appear in court as scheduled.
Clair McFarland can be reached at clair@cowboystatedaily.com.
