Donald Trump’s new acting attorney general, Matthew Whitaker, was involved in a company that scammed US military veterans out of their life savings, according to court filings and interviews.

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Whitaker, a former US attorney in Iowa, was paid to work as an advisory board member for World Patent Marketing (WPM), a Florida-based company accused by the US government of tricking aspiring inventors out of millions of dollars. Earlier this year, it was ordered to pay authorities $26m.

Several veterans, two of them with disabilities, said they lost tens of thousands of dollars in the WPM scam, having been enticed into paying for patenting and licensing services by the impressive credentials of Whitaker and his fellow advisers. None said they dealt with Whitaker directly.

“World Patent Marketing has devastated me emotionally, mentally and financially,” Melvin Kiaaina, of Hawaii, told a federal court last year, adding that he trusted the firm with his life savings in part because it “had respected people on the board of directors”.

The 60-year-old said he was a disabled veteran US army paratrooper and paid the company in 2015 and 2016 to patent and promote his ideas for fishing equipment.

“I received nothing for the $14,085 I paid to the company, other than a bad quality drawing and logo that my grandson could have made,” he said.

Kiaaina and other WPM customers described their experiences in declarations to court written under penalty of perjury, as part of a civil lawsuit brought by the Federal Trade Commission (FTC) against WPM and its chief executive, Scott Cooper. Emails filed as evidence to the case showed desperate customers begging Cooper and his team for their money back.

It was a lot of money, and he blamed me for losing it Gwendolyn Artman, ex-wife of WPM client

“You have caused me tremendous grief, I can’t sleep, my stress level is at an all-time high and the last of my savings has been stolen with nothing to show for it,” one unemployed widow, who lost $8,000, wrote to Cooper in December 2016. Another inventor who paid $12,000 said he was left with “a stress related condition that is eating away at my hair”.

In particular, WPM promoted itself as a champion of those who served in the military. “Not only do we honor the veterans and soldiers of our armed forces but we are also celebrating what they are protecting – the American dream,” it said in a statement timed for Veterans Day 2014, which highlighted Whitaker’s role at the firm. WPM claimed to have made an unspecified donation to the Wounded Warrior Project nonprofit, which did not respond to an email seeking confirmation of the payment.

Whitaker publicly vouched for WPM, claiming in a December 2014 statement it went “beyond making statements about doing business ‘ethically’ and translate[d] those words into action”.

He said: “I would only align myself with a first-class organisation.”

Facebook Twitter Pinterest Dennis and Gwendolyn Artman, before their divorce. Photograph: Provided by Gwendolyn Artman

But customers reported to authorities that they had been treated unethically by a company that, beneath its glossy marketing pamphlets, was a shabby operation.

Dennis Artman, a 24-year veteran of the army and air force reserves from Washington state, took $25,000 from his retirement savings account in 2015 to pay WPM to patent and promote a wearable device his then wife had created to jolt sleepy drivers awake and guide them to accommodation.

“He said, ‘I know it’s a lot of money but I believe in it and I believe in you,’” his ex-wife, Gwendolyn Artman, 58, said in an interview. Gwendolyn Artman said she received approximately 25 emails from WPM that touted the backgrounds of Whitaker and other board members.

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In late 2015, Artman said, WPM stopped returning her calls and emails. Only after she complained to the office of Florida’s attorney general did Cooper call – pleading with her to withdraw the complaint and promising to make amends. Again, nothing materialised.

The Artmans divorced this year after more than 10 years of marriage. Gwendolyn, who runs a not-for-profit treatment center for people suffering from opioid addiction, said the WPM saga was partly to blame.

“I think he lost faith in me,” she said. “It was a lot of money, and he blamed me for losing it.”

A justice department spokeswoman, Kerri Kupec, said in an email: “Acting attorney general Matt Whitaker has said he was not aware of any fraudulent activity. Any stories suggesting otherwise are false.”

Attorneys for Cooper did not respond to emails seeking comment. Cooper denied wrongdoing in the FTC case. He was ultimately ordered to pay $1m and surrender any proceeds from selling his $3.5m mansion in Miami, in return for the rest of the $26m judgment being suspended.

Some veterans who gave money to WPM said they were impressed by the inclusion on the advisory board of congressman Brian Mast, a Florida Republican who lost both his legs in a September 2010 bombing while serving with the army in Afghanistan.

One of these veterans, identified in court filings and company materials as “John D”, complained to Cooper that WPM had deserted him after using his status as a veteran to promote his idea for a new type of umbrella.

Facebook Twitter Pinterest Masti told the court he lost more than $75,000. Photograph: Used with permission

“I’m sure he’ll be your best supporter,” John D wrote of Mast in a September 2016 email, “but what about my product?”

Mast, who was re-elected this week, said in a declaration to court that Cooper appointed him to the advisory board without his consent after the two met twice in February 2016, at an event and then at WPM’s offices in Miami. Last year he returned $5,400 in campaign donations given to him by Cooper.

Another WPM client, Ryan Masti, who served in the navy and suffers from dyslexia and attention deficit hyperactivity disorder (ADHD), said a WPM representative boasted of the company’s connections to Whitaker and Mast in a promotional telephone call that persuaded him to hand over money.

Masti told the court he lost more than $75,000 after paying WPM to register, develop and promote his idea for “Socially Accepted”, a social network aimed at people with disabilities. He said that in return he received only a press release, a logo and a shoddy website template.

“I spent the money on a dream to help people,” Masti said in an interview on Friday. “And I lost everything.”

Masti, a 26-year-old farmer from upstate New York, borrowed $50,000 from his father’s retirement account, took out a commercial loan for about $20,000 and used another $7,000 he had inherited from his late grandfather, a veteran of the second world war. A WPM executive told him he “could make a million in sales” as a minimum, he said.

Having voted for Trump enthusiastically in 2016, Masti said on Friday he would soon be changing his party affiliation to Democratic, following the president’s elevation of Whitaker.

“It’s totally ridiculous,” said Masti. “It makes the whole Republican party look so bad. How could a president appoint someone like this? And then not have a problem about it when it comes out? He should be taking care of the victims.”