COVID-19 Fraud Enforcement Task Force 2024 Report April 2024 - Council of the Inspecors General on Integrity and Efficiency
- Issuer
- Department of Justice
- Document type
- Report
- Date
- 2024-04-09
Summary
The COVID-19 Fraud Enforcement Task Force 2024 Report, dated April 2024 and issued from the U.S. Department of Justice, compiling member agencies' work against pandemic fraud. The executive summary reports over 3,500 defendants criminally charged, over 400 civil settlements and judgments, and over $1.4 billion in fraudulently obtained CARES Act funds seized or forfeited. It states that legislation is required to extend the statute of limitations for COVID-19 fraud offenses and the PRAC's statutory authorization. The report states that as of December 31, 2023, approximately 2,005 defendants charged with pandemic-related fraud had pleaded guilty or been convicted at trial, and describes the COVID-19 Fraud Enforcement Strike Forces. The executive summary carries the signature blocks of Michael C. Galdo, Director of COVID-19 Fraud Enforcement, and two deputy directors.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Full text
U.S. Department of Justice
Washington, DC 20530
COVID-19 FRAUD ENFORCEMENT TASK FORCE
2024 REPORT
APRIL 2024
Council of the
INSPECTORS GENERAL
on INTEGRITY and EFFICIENCY
OIG
Office of Inspector General
Board 01 Governors ol the Federal Reser...e System
Consomef' Anendal Protection Bureau
I. Executive Summary since the pandemic’s peak, many of these
programs were targeted by fraudsters and
The COVID-19 Fraud Enforcement Task other criminals who sought to exploit the
Force (CFETF) is pleased to present in this government’s relief efforts for their
2024 report a compilation of its member personal gain.
agencies’ accomplishments to date to combat
pandemic fraud. While the CFETF has made The Department of Justice has
significant progress to identify, investigate, worked closely with its law enforcement
and punish COVID-19 fraud, substantial partners, including multiple Offices of
work remains in the face of numerous Inspectors General, to mobilize a
challenges. coordinated response to these illegal acts.
The Attorney General established the
Te CFETF’s coordinated approach has CFETF in 2021, subsequently creating the
resulted in: position of Director of COVID-19 Fraud
• Over 3,500 defendants criminally Enforcement and launching the
charged COVID-19 Fraud Enforcement
• Over 400 civil settlements and Strike Forces.
judgments
• Over $1.4 billion in fraudulently This coordinated approach has led
obtained CARES Act funds seized or to enforcement successes, including
forfeited criminal charges against more than 3,500
• A new, integrated, and data-driven defendants, civil enforcement actions
approach to investigate government resulting in more than 400 civil settlements
program fraud and judgments, and more than $1.4 billion in
seizures and forfeitures. In doing so, the
CFETF has disrupted transnational criminal
To continue the CFETF’s work and ensure networks and domestic violent
COVID-19 fraudsters don’t get away with offenders, making communities safer
it, legislation is required to: here and abroad. Importantly, the
• Extend the statute of limitations for all CFETF has leveraged its interagency
COVID-19 fraud-related ofenses network to make strategic improvements
• Extend the PRAC’s statutory in how the government investigates fraud,
authorization using the wide array of skills from
• Adequately resource COVID-19 its members to devise more effective
fraud data sharing, lead development, fraud fighting tactics.
investigations, prosecutions, and asset
recoveries While this report highlights
these accomplishments, much work
The COVID-19 pandemic prompted remains in the fight against COVID-19
the United States government to establish fraud. CFETF members have seen their
and administer federal relief programs at a budgets cut, straining resources to develop
size and scope virtually unprecedented in investigations and prosecute offenders. The
our nation’s history. And while these relief first years of the pandemic fraud response
programs helped to mitigate some of the were dedicated to coordination, data
pandemic’s most devastating effects, they collection, and the establishment of
also came with a cost. As has become interagency data sharing to generate
increasingly clear in the months and years actionable leads.
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But challenges loom. Four years finish the job—losing the opportunity to
have passed since the pandemic began. In recoup hundreds of millions of dollars in
the coming years, investigative targets fraud proceeds and placing our citizens and
will increasingly argue that their conduct government institutions at risk of future
falls outside the statute of criminal victimization.
limitations, threatening prosecutors’ ability
to hold wrongdoers accountable. The CFETF and its member
The Pandemic Response Accountability agencies have ongoing investigations into
Committee (PRAC), a body of 20 hundreds of identity thieves, transnational
federal Inspectors General overseeing fraud and money laundering networks,
pandemic relief spending, is due to large-dollar individual fraudsters, and
sunset next year. And tightening the businesses that facilitated these
budgets across the federal government crimes. Government employees who chose
make it increasingly difficult to to fraudulently obtain pandemic benefits are
adequately resource CFETF’s essential also being investigated. Civil enforcement
work. But to address these issues, tools are being utilized to recover
legislation is required. misappropriated funds from businesses
and individuals throughout the country.
The time to act is now. Under CFETF member agencies have
improved their data analytics capabilities
current CFETF funding levels, the
and are using these new skills to investigate
government lacks sufficient resources to
fraud more efficiently and effectively. And
prosecute fraudsters who didn’t just
the lessons learned by law enforcement
commit pandemic fraud, but targeted
from investigating pandemic fraud are being
the elderly through romance fraud used to improve our investigatory
schemes, U.S. companies through efforts and passed on to the agencies
business email compromise (BEC) tasked with administering benefit
schemes, and government programs through programs.
unemployment insurance fraud. DOJ
prosecutors in Baltimore and Detroit The Director of COVID-19 Fraud
have even taken down gang members and Enforcement and staff will continue
violent criminals for pandemic fraud, to work closely with relevant
securing prison sentences and recovering Department of Justice components in the
weapons and narcotics. Criminal and Civil Divisions, our Strike
Forces and U.S. Attorney’s Offices, and
If we fail to provide the necessary our law enforcement partners to ensure
PRAC data to CFETF agencies or neglect to that the government’s response to
extend the statute of limitations, our COVID-19 fraud is effective, coordinated,
agents and prosecutors won’t be able to and robust.
________________________
Michael C. Galdo
Director, COVID-19 Fraud Enforcement
________________________ ________________________
Amanda L. Riedel Colin Huntley
Deputy Director, Criminal Deputy Director, Civil
COVID-19 Fraud Enforcement COVID-19 Fraud Enforcement
---------,02
CRIMINAL, CIVIL, and ASSET RECOVERY ACTIONS
II. Department of Justice (PPP), and Economic Injury Disaster Loan
fraud (EIDL), but other types of CARES
The Department of Justice continues to Act fraud and health care fraud related to
prioritize the investigation and prosecution the COVID-19 pandemic were also charged.
of individuals and entities that committed The fraud loss associated with these cases
pandemic program fraud. The Department was more than $2.1 billion.
has marshaled resources from U.S.
Attorneys’ Offices and the Criminal, Civil,
U.S. Attorneys’ Ofces have criminally
Tax, and Antitrust Divisions to bring
criminal, civil, and asset recovery actions
charged 3,500 defendants in pandemic
against perpetrators of COVID-19 fraud. The fraud cases with associated losses of
Department supports a Director of COVID-19 more than $2B
Fraud Enforcement, two Deputy Directors
of COVID-19 Fraud Enforcement, a lead As of December 31, 2023, approximately
prosecutor for the National Unemployment 2,005 defendants charged with pandemic-
Insurance Task Force, a National COVID-19 related fraud have pleaded guilty or been
Fraud Forfeiture Coordinator, a National convicted at trial. The fraud loss associated
COVID-19 Fraud Coordinator, and with these completed cases is more than $1.2
COVID-19 Fraud Coordinators in each U.S. billion. While the number of resolutions is
Attorneys’ Office. In 2023, the Department impressive, U.S. Attorneys’ Offices have a
upscaled resources to address COVID-19 similar number of investigations open that
fraud by funding 50 term AUSA positions are yet to be charged.
dedicated to COVID-19 fraud enforcement.
And DOJ has stood up five COVID-19 Fraud Some examples of COVID-19 criminal
Enforcement Strike Forces across six federal fraud cases prosecuted by U.S. Attorneys’
districts to pursue the most impactful criminal Offices include:
COVID fraud cases – those involving large
amounts of loss, overseas actors, violent • In the Southern District of Georgia, a
offenders, and perpetrators who defrauded Florida-based attorney was convicted at
multiple pandemic-era aid programs. trial of conspiracy to fraudulently obtain
almost $800,000 in Economic Injury
A. U.S. Attorneys’ Offices Disaster Loans for herself and others.
As of December 31, 2023, U.S. Attorneys’ • In the Western District of Washington,
Offices criminally charged approximately the ringleader of a $6.8 million pandemic
3,500 defendants in 2,388 pandemic fraud- fraud ring was sentenced to five years in
related cases. Most of these cases involved prison for fraudulently seeking funds
unemployment insurance benefits fraud from various relief programs.
(UI), Paycheck Protection Program fraud
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• In the Eastern District of Washington, In addition to, or as part of COVID-19
an Arkansas-based business owner fraud criminal prosecutions, U.S. Attorneys’
pleaded guilty to fraudulently receiving Offices have pursued forfeitures and sought
more than $16.5 million in SBApandemic restitution orders in pandemic fraud matters.
relief funds for himself and others. To date, COVID-19 fraud investigations in
which the Department has been involved—
• In the Eastern District of Virginia, including but not limited to investigations led
a former VA nurse was sentenced to by the Department of Justice, Department of
18 years in prison for conspiring to Homeland Security, Department of Treasury,
fraudulently obtain more than $3.5 United States Postal Inspection Service,
million in UI benefits from at least five Department of Labor-Office of Inspector
states. She and her co-conspirators filed General, and Small Business Administration-
more than 220 false applications for Office of Inspector General—have resulted
unemployment insurance benefits using in significant civil and criminal forfeitures,
stolen identities and the identities of state restitution orders, and collaboration with
and federal prison inmates. private industry partners to combat fraud.
• In the Middle District of Florida, a
defendant was sentenced to eight years DOJ and law enforcement partners
and six months in prison for obtaining have obtained fnal forfeitures of over
more than $7.2 million in PPP loan funds, $1B
which he used to purchase Maserati and
Mercedes-Benz cars and buy a 12-acre
estate. For example, as of the end of 2023,
forfeitures in civil administrative, civil
• The District of Minnesota has brought judicial, and criminal judicial cases resulted
charges against more than 50 individuals in the final forfeiture of more than $1 billion
for their respective roles in a $250 million in fraud proceeds. Although criminal cases
fraud scheme that exploited a federally and forfeitures serve as a key tool in the
funded child nutrition program during prosecutorial mission to address COVID-19
the COVID-19 pandemic. fraud, in many instances, final forfeiture
via civil administrative and civil judicial
• In the Eastern District of Michigan, means facilitated the recovery of hundreds
a man was sentenced to 15 years in of millions of dollars when individual bad
prison for his role as the ringleader of actors could not be located or extradited
conspiracies to use stolen identities for criminal prosecution. Consistent with
to fraudulently obtain $2.1 million the Department’s goal of using forfeited
in unemployment insurance benefits assets to compensate victims, much of the
from multiple states and to traffic in finally forfeited money has been returned
methamphetamine. to victimized federal and state agencies and
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financial institutions or is currently being • A Texas-based commercial roofing
processed for potential return to victims. contractor and its nationwide network of
Yet other money remains seized, pending roofing and disposal companies agreed
additional process. to pay $9 million to resolve allegations
that they violated the False Claims Act
Enforcement efforts as of the end of (FCA) by falsely certifying that eight of
2023 in COVID-19 fraud-related criminal their affiliates were eligible to receive
prosecutions for which statutes authorized loans through the Small Business
restitution resulted in the issuance of over Administration’s (SBA) Paycheck
$882 million in total restitution orders to Protection Program (PPP).
both government and private victims.
• A Georgia urgent care chain agreed
Finally, outside of formal forfeiture to pay $1,600,000 to resolve allegations
seizure or restitution processes, federal law that they violated the False Claims Act
enforcement regularly consults with financial (FCA) by submitting improperly upcoded
institutions that have received fraudulently Evaluation and Management claims to
obtained UI funds but now seek law Medicare for the testing and treatment
enforcement input on the voluntary return of patients with suspected exposure
of those funds to defrauded state workforce to COVID-19 during the Coronavirus
and unemployment agencies. Such informal pandemic.
efforts, wherein private actors seek law
enforcement assistance in building bridges • A California-based technology
among appropriate financial institution, state services company agreed to resolve
agency, and DOL points of contact, have allegations that it knowingly violated
resulted in the return of billions of dollars in the False Claims Act when it applied
fraud proceeds outside of the forfeiture and for, received, and retained two Paycheck
restitution framework. Protection Program (PPP) loans totaling
$400,000 in violation of PPP rules,
As of April 1, 2024, USAOs, in falsely certifying that it met company
conjunction with the Civil Division, have size restrictions for the loans, and that its
also opened over 1,200 civil pandemic revenue decreased in excess of 25% from
fraud matters, including more than 600 qui 2019 to 2020, a program requirement,
tam cases. Civil AUSAs and Civil Division when its revenue increased.
attorneys obtained more than 400 judgments
or settlements totaling over $100M. These In addition, USAOs, through the
cases include PPP, EIDL, health care fraud, Executive Office for U.S. Attorneys
agricultural program fraud, and fraud on (EOUSA), have partnered with the Civil
other pandemic-relief programs. Examples Division to develop and roll out database
of these cases include: tools to detect and investigate fraud. This
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includes the analysis of more than 225
million claims paid by the Health Resources To date, strike force districts have
and Services Administration’s COVID-19 charged more than 250 defendants
Uninsured Program and approximately 15 with associated losses of over $339
million PPP and EIDL loans. EOUSA has million
partnered with the Civil Division to provide
training on using the databases to investigate
fraud in these programs. 1. California Strike Force
B. COVID-19 Fraud Enforcement The Eastern and Central Districts of
Strike Forces California joint COVID Fraud Strike Force
was formed in August 2022. As strike force
In September 2022, DOJ announced district, the Eastern and Central Districts
the establishment of three COVID-19 fraud of California oversee agents, analysts, and
enforcement strike forces, which are housed AUSAs to bring the most impactful criminal
in the U.S. Attorneys’ Offices for the District pandemic fraud cases, often involving
of Maryland, Southern District of Florida, multiple CARES Act programs, foreign
and a joint task force co-located in the actors, violent perpetrators, or large loss
Eastern and Central Districts of California. amounts.
In August 2023, two additional Strike Forces
were announced in the District of New Jersey Since the inception of the Strike Force,
and District of Colorado. The strike forces the EDCA has criminally charged 17 cases
are comprised of dedicated prosecutors with associated actual losses of over $20
and agents from the Department of Labor million, including:
Office of Inspector General, Small Business
Administration Office of Inspector General, • A defendant was sentenced to 81
Department of Homeland Security Office of months in federal prison for using stolen
Inspector General, FBI, U.S. Secret Service, identities to claim over $9 million in
Homeland Security Investigations, Internal fraudulent UI and EIDL benefits.
Revenue Service Criminal Investigations, • A defendant, who was an inmate at the
and U.S. Postal Inspection Service, with time of the offenses, was sentenced to 84
assistance from the PRAC and the Special months for participating in a conspiracy
Inspector General for Pandemic Recovery. to use stolen identities to claim more than
The OCDETF Fusion Center and OCDETF’s $1 million in UI payments, of which the
International Organized Crime Intelligence conspirators fraudulently obtained over
and Operations Center, the Financial Crimes $890,000.
Enforcement Network, and the National
Unemployment Insurance Fraud Task Force • A former gang member and inmate at
provide key support to the strike forces the time of the offenses was sentenced to
by providing leads, case intelligence, and 65 months in prison for his role in $25
deconfliction. million UI fraud scheme.
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toward achieving just results and significantly
EDCA prosecuted a gang member deterring fraud involving taxpayer-funded
for fraudulently claiming $25M in UI programs.
benefts
In one CDCA prosecution, a jury
• A woman was sentenced to 75 months convicted a ring of defendants who
in prison for using stolen identities to fraudulently obtaining more than $20 million
claim over $350,000 in UI and SBA in PPP and EDIL funds. The lead defendant
benefits, of which she successfully fled the U.S. and was sentenced in absentia
obtained approximately $200,000. to 17 years in prison. In another matter, a
defendant pleaded guilty and was sentenced
The EDCA has also successfully to 30 months’ imprisonment for fraudulently
forfeited funds derived from pandemic obtaining more than $500,000 in UI benefits
fraud. In one case, the government secured using names of dozens of California state
an order of forfeiture for the lead defendant’s prison inmates.
new condominium in Nigeria, which was
purchased with UI fraud proceeds.
CDCA convicted at trial a ring of
The EDCA continues to investigate and fraudsters who fraudulently obtained
prosecute all manner of pandemic fraud. $20M in SBA loans
For example, in February 2024, the EDCA
charged several defendants in a case involving
the CARES Act Employee Retention Credit. In April 2023, CDCA participated in
The charged conduct, orchestrated from a nationwide sweep to combat COVID
prison, involved defendants conspiring to stimulus-related and health care fraud. In one
pursue over half a billion dollars in federal case, a physician and two other individuals
tax credits that were meant to help struggling were charged with submitting over 70
businesses during the COVID-19 pandemic. fraudulent PPP and EIDL applications and
fraudulently obtained over $3 million. The
The Central District of California has physician was also charged with allegedly
joined with FBI, IRS CI, SBA-OIG, HHS- submitting more than $200 million in
OIG, DOL-OIG, TIGTA, USSS, and several false claims to the Health Resources and
local law enforcement agencies to initiate Services Administration (HRSA) COVID-19
37 criminal cases involving 72 individuals Uninsured Program, a program designed to
suspected of committing PPP, EIDL, UI, prevent the further spread of the pandemic
and ERC fraud, with losses identified of by providing access to uninsured patients for
more than approximately $126 million. testing and treatment.
Approximately 15 of the 35 cases involve
fraudulent UI claims with collective losses CDCA and its law enforcement partners
of more than $53 million. CDCA’s cases have seized and forfeited over $450,000 in
have covered a broad spectrum of criminal UI-related cases and nearly $2 million in
activity in its diverse population with a view SBA loan fraud cases.
--o~- 7
CDCA has continued to increase its staffing fraud cases from the Maryland Strike Force
to combat pandemic program-related fraud. include:
COVID fraud cases are worked by criminal
AUSAs across the district, in the Major • The U.S. Attorney’s Office charged
Frauds, Violent and Organized Crime, and six individuals, including two Maryland
General Crimes Sections. CDCA has also State Department of Labor subcontractors,
hired an attorney from IRS CT Counsel’s with participating in a conspiracy to
Office to fill a dedicated Covid Strike Force fraudulently obtain approximately $3.5
SAUSA position to focus on tax-related million in UI benefits. The lead defendant
pandemic fraud matters. faces separate narcotics and firearms
charges, including allegations that he
2. District of Maryland Strike Force unlawfully possessed a machine gun in
furtherance of a drug trafficking crime.
Since the creation of Maryland’s
COVID-19 Strike Force, the U.S. Attorney’s • Eleven individuals were charged
Office for the District of Maryland (USAO- in connection with a $1.6M UI fraud
MD) has handled more than 80 criminal conspiracy involving aggravated identity
investigations into COVID-19 fraud, with theft. Five of the nine defendants have
overall potential losses totaling more than pleaded guilty and two of the defendants
$100 million. At least 30 defendants have have each been sentenced to more than
been criminally charged with COVID-19 four years in prison.
fraud-related offenses involving alleged loss
amounts exceeding $55 million. USAO- The USAO-MD currently has more
MD currently dozens of open COVID-19 than 30 SBA loan fraud investigations
fraud investigations and prosecutions with and prosecutions, with anticipated losses
cumulative losses exceeding $70 million. exceeding $40 million. For example, a
In support of these efforts, the Maryland defendant pleaded guilty in October 2023,
Strike Force currently has five dedicated to submitting more than $17.9 million in
criminal AUSAs and a paralegal working on fraudulent CARES Act loan applications
pandemic fraud matters as well as criminal on behalf of himself and his coconspirators,
AUSAs outside of the strike force handling using the illicitly obtained funds to travel
significant COVID-related cases. The district internationally, purchase property in Egypt,
also has numerous active civil fraud cases and open a beachfront restaurant.
pending with tens of millions of dollars in
associated potential losses. The USAO-MD has targeted cases with
connections between COVID-19 fraud
In June 2021, the State of Maryland and individuals involved in violent crime,
flagged an astonishing 1.3 million UI claims organized criminal networks, business
as potentially fraudulent. Accordingly, UI email compromise schemes, and narcotics
fraud makes up a large portion of USAO-MD distribution. Using probable cause from the
Strike Force investigations. Some notable UI commission of COVID-19 fraud, agents
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have conducted searches and seized illegal law enforcement agents recovered four
firearms, narcotics, and stolen personally firearms.
identifying information. The USAO-MD
Strike Force continues to investigate and 3. Southern District of Florida
charge violent and drug offenders who Strike Force
committed pandemic program fraud as
part of the U.S. Attorney’s “Al Capone” Since the creation of the Southern District
strategy to get guns and violent criminals off of Florida’s COVID-19 Strike Force, the U.S.
Maryland’s streets. For example: Attorney’s Office for the Southern District
of Florida (SDFL) has charged more than
• A convicted felon was charged with 50 defendants with COVID fraud-related
CARES Act fraud as well as firearm offenses involving alleged loss amounts
offenses and possession with the intent exceeding $76 million. In support of these
to distribute fentanyl. efforts, SDFL currently has four dedicated
criminal AUSAs working on criminal
pandemic fraud cases and investigations, as
D-Maryland defendant sentenced to well as criminal AUSAs outside of the strike
7 years in prison for COVID-19 fraud force handling significant COVID-related
found with an illegal machine gun matters.
Examples of SDFL’s Strike Force efforts
• A defendant was sentenced to seven include:
years in federal prison for committing
PPP, EIDL, and UI fraud, with actual • The SDFL indicted 17 employees
losses of more than $1 million and of the Broward Sheriff’s Office were
attempted losses of $3 million. When the charged with obtaining fraudulent PPP/
government executed search warrants EIDL loans. One former deputy was
in the case, agents recovered stolen recently convicted at trial, several
identifying information and ghost guns, employees have pleaded guilty, and other
including one modified to function as a defendants’ cases are still pending.
machine gun.
17 Broward County Sherif ’s Ofce
• A defendant pleaded guilty to employees charged with PPP fraud
submitting more than $3.5 million in
fraudulent COVID-19 PPP and EIDL
applications and using fraudulently • A defendant was sentenced to
obtained funds to pay for a vacation, a 71 months in prison for fraudulently
Mercedes-Benz, jewelry, and luxury obtaining PPP and EIDL loans and
goods, including items from Luis Shuttered Venue Operator Grants
Vuitton, Neiman Marcus, Dior, Cartier, (SVOG), using the stolen funds to buy
Gucci, Chanel, and Hermes. During a two Tesla S models, a Lamborghini, a
search of a residence at the time of arrest, Porsche, a diamond Audemars Piguet
--o~- 9
watch, a rose gold and diamond pendant At present, the District of New Jersey
with his company’s logo, a half-kilogram has four criminal AUSAs dedicated to
gold chain with 70 carats of diamonds, prosecuting COVID-19 fraud cases on a
and a 1-kilogram gold chain. full-time basis. On January 25 and 26, 2024,
the District of New Jersey hosted a two-day
• A former contract detention officer strike force coordination meeting, which had
at the federal Krome Detention facility over 60 participants. Currently, 12 partner
who was the leader of a PPP fraud ring agencies participate in the New Jersey
was sentenced to 32 months in prison for Strike Force, with 25 dedicated agents and
preparing fraudulent PPP applications in investigators supporting the strike force’s
return for kickbacks. efforts.
Since the inception of the COVID-19
• A defendant was sentenced to 70 Fraud Strike Force in August 2023, the District
months in prison for laundering the overof New Jersey has charged approximately 18
$2 million in fraudulently obtained PPP individuals with COVID-19 loan fraud and
and EIDL loans and using the funds to fraud committed in connection with obtaining
gamble and to pay for cosmetic surgery, unemployment benefits and tax stimulus
a Cadillac Escalade, and a Pomeranian payments. Approximately seven COVID-19
puppy. fraud defendants have been sentenced,
resulting in restitution orders totaling more
• A defendant was sentenced to 41 than $5 million. For example, co-defendants
months1 in prison and ordered to pay indicted in a $3.75 million PPP fraud scheme
$643,000 in restitution for his role in are set to be tried in July 2024.
a conspiracy to use stolen identities
to fraudulently obtain more than $1.1 The District of New Jersey currently
has approximately 25 unresolved charged
million in UI funds. His coconspirators
COVID-19 fraud cases and is overseeing
were each sentenced to 33 months in
dozens of ongoing pandemic fraud
prison.
investigations. The District of New Jersey
remains committed to prosecuting fraudsters
4. District of New Jersey Strike Force in New Jersey and throughout the country
who stole much-needed funds from small
In August 2023, the District of New Jersey business and families during the pandemic.
launched its COVID-19 Fraud Strike Force,
which built upon the previously established 5. District of Colorado Strike Force
COVID-19 Fraud Task Force. Since the start
of the pandemic, the District of New Jersey In August 2023, the District of Colorado
has charged approximately 104 defendants launched its COVID-19 Fraud Strike Force.
with COVID-19 fraud. Since the start of the pandemic, the District of
Colorado and partner agencies participating
in the strike force have devoted significant
1
See p. 6.
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resources to combatting COVID-19 fraud The District of Colorado has also worked
committed in Colorado and around the closely with law enforcement partners to seize
country. The District of Colorado has four more than $1 billon in wrongfully obtained
criminal AUSAs working on its COVID-19 EIDL assets, as well as to forfeit houses,
Fraud Strike Force, including two term vehicles, cryptocurrency, and bank accounts.
AUSAs hired in the first quarter of 2024. The District of Colorado obtained a seizure
Additionally, the District of Colorado has warrant that led to the seizure of over 15,000
ten civil AUSAs, along with support staff, accounts and approximately $286 million in
working on False Claims Act investigations fraudulently obtained EIDLs, which funds
involving COVID-19 fraud. the U.S. Secret Service ultimately returned
to the SBA.
To date, the District of Colorado has
charged more than 20 individuals with C. Criminal Division
COVID-19 loan fraud and fraud committed in
connection with obtaining UI benefits and tax 1. Fraud Section
stimulus payments. Of those, 12 defendants
have been convicted and sentenced, resulting The Fraud Section has continued to
in restitution orders totaling more than $14 expand its efforts to combat COVID-19-
million. Two additional defendants have related fraud both in the Market Integrity and
pleaded guilty and are awaiting sentencing. Major Fraud (MIMF) Unit and the Health
Care Fraud Unit (HCF). The Fraud Section
For example, the District of Colorado maintains its focus on programs created or
charged four defendants with a wire fraud expanded by the CARES Act, including
and money laundering conspiracy. The PPP and EIDL programs, Provider Relief
indictment alleges that the conspirators Fund (PRF) programs, and Health Resources
fraudulently obtained more than $8 million and Services Administration’s COVID-19
in COVID-19 business loans, unemployment Uninsured Program (UIP). The HCF Unit
benefits, tax refunds, and tax stimulus has targeted individuals and entities that
payments using the names of identity-theft are took advantage of COVID-19 testing
victims. In another case, a defendant was programs, including CMS’s COVID-19 over-
sentenced to 51 months’ imprisonment and the-counter test kit demonstration. Since
ordered him to pay more than $1 million August 2022, the HCF Unit, in partnership
in restitution for preparing and submitting with various U.S. Attorney’s Offices and
fraudulent PPP loan applications. law enforcement agencies, has charged 19
defendants for COVID-19-related fraud
involving more than $393 million in alleged
D-Colorado and law enforcement loss, while the MIMF Unit has charged
partners seized over $1B in 63 defendants involving more than $116
million in intended loss. The MIMF Unit has
fraudulently obtained EIDL funds
continued its enforcement efforts through 11
trials of COVID fraud cases in the last two
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years. For example, the MIMF Unit and its COVID-19 vaccination cards, and (d) the
U.S. Attorney’s Office partners prosecuted submission of fraudulent loan agreements,
a total of 16 defendants, all of whom were attestations, and other documentation to
convicted in the Southern District of Texas obtain millions in PRF and EIDL funds. In
for engaging in a conspiracy to fraudulently one such case from the Central District of
obtain more than $20 million in PPP loans. California, the Fraud Section’s HCF Unit
The ringleader of the conspiracy was secured a ten-year prison sentence for a man
sentenced to 15 years in prison. who operated a laboratory that fraudulently
billed Medicare for $234 million in lab tests,
Since 2022, the Fraud Section and including COVID-19 testing. The defendant
USAO partners have criminally was also ordered to forfeit over $31 million
and ordered to pay more than $31 million in
prosecuted 82 defendants for restitution.
COVID-19 fraud with associated
losses over $500M 2. Money Laundering and Asset
Recovery Section
In April 2023, the HCF Unit, along
with its U.S. Attorney’s Office and law The Money Laundering and Asset
enforcement partners, announced its largest Recovery Section (MLARS) continues
Nationwide Coordinated Law Enforcement to work in coordination with the CFETF,
Action to Combat COVID-19 Health Care EOUSA, the Justice and Treasury asset
Fraud. Building on the success of prior forfeiture funds, and law enforcement
years’ COVID-19 enforcement actions, agencies, on forfeiture of the proceeds of
the HCF Unit announced criminal charges CARES Act-related fraud and the return
against 18 defendants across nine federal of forfeited funds to victim agencies and
districts for alleged participation in various financial institutions. MLARS’ Program
fraud schemes involving health care services Management and Training Unit (PMTU)
that exploited the COVID-19 pandemic and will continue working with SBA, Labor, and
allegedly resulted in over $490 million in other agencies and financial institutions to
COVID-19-related false billings to federal return forfeited funds through the restoration
programs and theft from federally funded and remission programs overseen by PMTU.
pandemic programs. The enforcement action
included seizures of more than $16 million. 3. Office of International Affairs
These charged schemes include: (a) the
submission of fraudulent claims to the UIP for Since the start of the pandemic, the
services not provided and services that were Office of International Affairs (OIA) has
not medically necessary, (b) the buying and partnered with domestic prosecutors and
selling of Medicare beneficiary identification agents, and with foreign authorities, to
numbers that were used to bill Medicare combat transnational crimes flowing from
for COVID-19 over-the-counter test kits, the pandemic. OIA is instrumental in
(c) the manufacture and distribution of fake securing mutual legal assistance (MLA) and
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extradition in connection with investigations to pandemic relief programs. In addition to
and prosecutions. Examples of OIA combatting fraud in connection with SBA
assistance include over 80 incoming MLA programs, CIV-Fraud continues to lead
requests from around the world seeking investigations into virtually every aspect of
evidence for use in foreign investigations the government’s pandemic relief efforts,
and prosecutions related to the pandemic. including state and local governments
OIA has opened dozens of MLA matters and tribal entities that received grants;
related to pandemic-based fraud to countries government procurements for PPE and other
in Africa, Asia, Europe, and North America. essential goods; and payment advances and
In February 2023, OIA assisted in the grants to health care providers during the
extradition of a defendant from Germany to pandemic. It also is investigating a wide
the Western District of Washington, where he range of health care fraud matters, including
is charged with a multimillion-dollar scheme those alleging misconduct in connection with
to defraud U.S. government programs of at COVID-19 testing and treatment.
least US $2.4 million, the majority of which
constituted COVID-19 UI benefits. In April The CIV-Fraud Section spearheaded the
2023, OIA assisted with the removal of a creation, implementation, and expansion of
defendant from Thailand via deportation to its customized data platforms to analyze and
face PPP-related fraud charges in the Central detect fraud across approximately 15 million
District of California. Additionally, OIA has PPP and EIDL loans and more than 225
made several outgoing extradition requests million claims paid by the Health Resources
seeking multiple individuals wanted for and Services Administration’s COVID-19
large-scale pandemic relief fraud. Uninsured Program. These tools have been
used by scores of attorneys, auditors, and
D. Civil Division investigators across nearly all U.S. Attorneys’
Offices, as well as the FBI and DOJ Asset
1. Civil Fraud Section Forfeiture teams, to generate high-value
investigative leads and to examine and
The Commercial Litigation Branch, prioritize voluminous referrals. In addition,
Fraud Section, has primary responsibility the CIV-Fraud Section has continued to
for enforcing the False Claims Act (FCA), provide training to U.S. Attorneys’ Offices,
the government’s primary civil tool to Offices of Inspectors General, and external
redress fraud impacting federal funds, and stakeholders on a wide range of pandemic
the Financial Institutions Reform Recovery relief programs and civil enforcement tools.
and Enforcement Act of 1989 (FIRREA),
which provides for civil penalties for
CIV-Fraud and USAOs have obtained
certain financial crimes. Since the start of
the COVID-19 pandemic, CIV-Fraud has more than 400 False Claims Act
partnered closely with U.S. Attorneys’ settlements and judgments totaling
Offices nationwide on an unprecedented over $100M
surge in civil fraud investigations relating
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To date, CIV-Fraud has opened more than The Department has seen a steady
1,200 new investigations relating to potential increase in the number of new qui tam actions
fraud in connection with multiple pandemic filed under the False Claims Act alleging
relief programs. These include investigations fraud in connection with pandemic relief
implicating more than 6,000 individuals and programs, with year-over-year increases
entities and billions of dollars in pandemic from 2020 through 2023. Combined with
relief funds. As of April 1, 2024, USAOs, the growing number of investigative leads
in conjunction with the Civil Division, developed through data analytics, the Civil
have also opened over 1,200 civil pandemic Fraud Section anticipates that civil pandemic
fraud matters, including more than 600 qui fraud enforcement will continue to require
tam cases. Civil AUSAs and Civil Division substantial resources for years to come.
attorneys obtained more than 400 judgments
and settlements totaling over $100M. 2. Consumer Protection Branch
Notable examples include:
The Consumer Protection Branch has
• A Florida-based automotive pursued actions against distributors of fake
management company agreed to COVID-19 treatments and cures, as well
pay more than $9 million to resolve as other individuals and entities engaged
allegations that it knowingly violated in conduct that threatens the health of
the FCA by providing false information consumers. Throughout the pandemic, the
relating to its corporate affiliations and Branch brought civil and criminal cases,
size in support of a PPP loan forgiveness including actions against sellers of fraudulent
application. COVID treatments, purveyors of faulty
PPE, individuals who deliberately tampered
• A New Jersey public relations firm with COVID vaccines, and those selling
paid $2.24 million to resolve allegations fraudulent covid products online. Some of
that it knowingly violated the FCA by these actions were brought under the new
falsely certifying its compliance with COVID-19 Consumer Protection Act, which
PPP requirements even though it was was signed into law in December 2020. For
ineligible for the loan due to its status example, in August 2023 the Branch secured
as a registrant under the Foreign Agent a $1 million judgment against a company
Registration Act. and individual that marketed vitamin
supplements as providing equal or better
• A Georgia-based clinical laboratory, protection against COVID-19 than vaccines.
along with its owner, agreed to pay more The Branch also pursued ongoing litigation
than $13 million to resolve allegations during 2023 against entities that allegedly
that it sought to profit off the COVID-19 sold products such as tea or nasal spray as
pandemic by paying independent COVID-19 cures or treatments. Additionally,
contractor sales representatives to the Branch, along with USPIS and FBI,
recommend expensive and medically continues to lead an annual campaign to
unnecessary respiratory pathogen disrupt money mule networks—including
panels to senior communities that were those used to move stolen pandemic-relief
interested only in COVID-19 tests. funds.
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E. Tax Division Because the ERC was available for
relatively recent years (2020 and 2021) and
The Tax Division has focused its efforts given the complexity of identifying and
regarding COVID-19 fraud on combating prosecuting these offenses, the Tax Division
abuse of the Employee Retention Credit expects that prosecuting ERC-related
(“ERC”). A substantial part of this effort crimes will continue to be a priority for the
involves providing training and guidance foreseeable future.
about the topic to prosecutors throughout
the country. For example, the Division F. Antitrust Division
presented a nationwide training through the
Executive Office of United States Attorneys Since the start of the COVID-19
on how to investigate and charge ERC fraud. pandemic, the Department of Justice’s
The Tax Division also published an article Antitrust Division has fulfilled its mission—
in the DOJ’s Journal of Federal Law and the promotion of economic competition
Practice, providing an overview of COVID- through enforcement of antitrust laws and
related tax fraud, including the ERC. Tax principles. The Antitrust Division adopted
Division attorneys have provided trainings a multi-faceted COVID-19 response,
on ERC-related crimes to criminal and civil particularly as it pertains to fraud and related
enforcement personnel at the IRS. crimes impacting competition. The Antitrust
Division’s initial response to the pandemic,
which included widespread public messaging
Tax Division and D-NJ charged a tax about the intersection of competition law and
preparer with fling thousands of tax the whole-of-government response to the
returns claiming fraudulent COVID public health emergency, has matured into
tax credits more targeted outreach and enforcement.
The Antitrust Division’s response to
Tax Division trial attorneys are directly the COVID-19 pandemic also includes its
involved in the prosecution of ERC fraud. continued leadership of the Department’s
The Division has assigned a trial attorney to Procurement Collusion Strike Force
each of the COVID-19 fraud strike forces to (“PCSF”) and an active program of outreach,
develop investigations into ERC schemes. engagement, and training. The PCSF, which
Tax Division prosecutors have also added is the Department’s coordinated, national,
ERC cases to their regular litigation dockets. inter-agency answer to collusion and other
In one notable example, along with the U.S. schemes targeting government spending
Attorney’s Office for the District of New at all levels, continued its efforts in the
Jersey, the Tax Division charged a defendant face of crisis-related disruptions. Since
with preparing more than a thousand false tax August 2022, the PCSF has trained other
returns seeking tens of millions of dollars in law enforcement agency partners, frontline
refunds based on the ERC and the COVID- agencies responsible for disbursing and
related Sick and Family Leave Credit. overseeing federal grants, state officials from
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offices of attorneys general and procurement dashboards with approximately twenty data
agencies, and private-sector groups in the and law enforcement personnel from nearly
healthcare, compliance, education, and other a dozen oversight agencies to aid in their
sectors. proactive data analytics efforts. In 2024, the
PCSF will distribute judicial district-specific
dashboard results to PCSF representatives
In an Antitrust case, seven companies throughout the country to focus joint law
agreed to pay over $681M in criminal enforcement efforts on local high-risk
penalties for illegally raising the price contractors. In August 2023, the Antitrust
COVID-19 drugs Division announced the final resolutions
in investigation into criminal conduct by
generic pharmaceutical companies. The
In 2022-2023, the PCSF collaborated with Antitrust Division, the U.S. Attorney’s Office
the PRAC to develop a series of data analytic for the Eastern District of Pennsylvania, the
dashboards that identify federal government FBI, and the U.S. Postal Service Office of
contractors believed to be at a higher risk Inspector General uncovered price-fixing,
for misusing pandemic relief funding. The bid-rigging and market-allocation schemes
dashboards identified contractors who met affecting many generic medicines, including
one of multiple sets of criteria. One set of illegally raising the prices of prescription
criteria was developed using data obtained drugs necessary to treat or reduce the risk of
by the Executive Office for the United States conditions known to amplify or worsen the
Attorneys, and the others were developed effects of a COVID-19 infection. All told,
using publicly- and non-publicly available the seven generic drug company defendants
spending and identification data. Pursuant collectively agreed to pay more than $681
to an agreement between the PRAC and the million in criminal penalties.
Antitrust Division, the PCSF shared these
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TASK FORCES
III. National Unemployment The NUIFTF acts as a first-of-its-kind
Insurance Fraud Task Force lead generator for agents and prosecutors.
The task force focuses on criminal networks
In late 2020, in response to massive and using data analytics to identify foreign
pandemic UI fraud, the Office of the Deputy actors who committed not just pandemic-
Attorney General created the National era fraud, but routinely perpetrate romance
Unemployment Insurance Fraud Task Force scams, BEC scams, and other types of cyber-
(NUIFTF). Although originally focused on enabled fraud. To date, the NUIFTF initiated
UI fraud, the task force has expanded to approximately 189 pandemic fraud leads
collect and analyze data related to all manner and has transmitted more than 100 leads to
of CARES Act fraud. The NUIFTF is headed agencies and USAOs, each with dozens, if
by a lead prosecutor and is comprised of not hundreds, of associated fraudulent UI,
agents, analysts, and data scientists from PPP, and EIDL claims. The NUIFTF also
DOL-OIG, FBI, HSI, USSS, IRS-CI, SBA- developed intelligence to enhance ongoing
OIG, USPIS, SSA-OIG, DHS-OIG, and the investigations to assist in the identification
PRAC. Among other things, the task force of criminal conduct and actors. To date,
works closely with DOJ’s Organized Crime the intelligence generated by the NUIFTF
Drug Enforcement Task Forces’ (OCDETF) represents over $3.3B in suspected pandemic
International Organized Crime Intelligence fraud.
and Operations Center (IOC-2) and DOL-
OIG to identify the largest perpetrators of For example, the NUIFTF sent a lead
COVID-19 fraud, focusing on transnational to the Western District of Washington
criminal networks. The NUIFTF and IOC- involving approximately $25 million in
2 oversee the collection and sharing of attempted COVID fraud, consisting of over
data related to unemployment insurance 1,700 fraudulent claims for UI benefits filed
claims and SBA loan information for an in over 25 states, all of which involved the
intergovernmental approach to identifying use of stolen identities. The lead led to the
patterns of fraud and sharing best practices indictment of two defendants, one of which,
for data science and intelligence. a Nigerian national, was sentenced to 42
months’ imprisonment after being extradited
Te NUIFTF, a frst-of-its-kind task from Germany. The second defendant, also
force generating actionable leads a Nigerian national, is awaiting extradition
against foreign actors and crime from Canada.
syndicates committing cyber-enabled
The NUIFTF has several key functions,
fraud, has disseminated over 100 leads all of which are ongoing and remain crucial
and intelligence associated with over in the continued pursuit of COVID-19 fraud
$3B in suspected pandemic fraud enforcement:
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• The NUIFTF assisted in the creation and support oversight of the federal
of the five Covid Fraud Strike Forces and government’s COVID-19 pandemic response.
provides high value leads to each Strike The PRAC coordinates with 20 member
Force, many of which involve foreign Offices of Inspectors General (OIG) to
targets. oversee more than $5 trillion in COVID-19
spending, identify major risks that cross
• The NUIFTF provides investigators program and agency boundaries, and detect
with a central location where searches of fraud, waste, abuse, and mismanagement of
multiple pandemic relief data sets can be relief funds. The PRAC also provides timely,
conducted, rather than having to pursue accessible, and comprehensive spending data
data that was previously siloed within on its website, Pandemic Oversight - Home |
various state and federal agencies. Pandemic Oversight.
• The NUIFTF has provided COVID
fraud investigation trainings to federal Te PRAC’s eforts have led to 127
law enforcement, local law enforcement, investigations, over 60 defendants
and USAOs across the country. charged, 44 years in collective prison
time, and $11M in restitution
• The NUIFTF joined with the FBI’s
Safe Streets Task Force and DOL-OIG
to initiate and pursue a violent offender The PRAC Fraud Task Force is a key
pandemic fraud program in multiple component of the organization’s cross-
cities across the United States. That cutting efforts. Comprised of more than 50
ongoing initiative seeks to identify agents from over a dozen member OIGs, the
violent offenders under criminal PRAC Fraud Task Force investigates cases
investigation who also participated in in pandemic programs with significant fraud,
pandemic program fraud. such as SBA’s EIDL and PPP loans. As of
January 2024, the PRAC Fraud Task Force’s
The NUIFTF continues to regularly efforts have resulted in 127 investigations
receive millions of new data points from with over 60 individuals charged, 44 years
state workforce agencies and other sources in collective prison time, and $11 million in
that will enable the refinement of existing court-ordered restitution. In the PRAC Fraud
leads and the creation of new COVID-19 Task Force’s largest investigation to date,
fraud leads for the foreseeable future. 14 individuals were charged in an alleged
$53 million PPP fraud scheme. Allegedly,
IV. Pandemic Response several of these individuals used a group of
Accountability Committee affiliated recycling companies to submit at
least 29 fraudulent PPP loan applications that
The 2020 CARES Act created the included inflated payroll expenses, doctored
Pandemic Response Accountability bank statements, and false tax forms to
Committee (PRAC) to promote transparency financial institutions.
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In addition to conducting investigations In January 2023, the PRAC issued a
through the collective power of its OIG Fraud Alert in which the PACE and its team
partners, the PRAC also provides robust of data scientists identified more than 69,000
investigative support to law enforcement questionable Social Security Numbers that
partners in a variety of ways. The Pandemic were used to obtain $5.4 billion in potentially
Analytics Center of Excellence (PACE) fraudulent pandemic loans.
offers data management, advanced
analytic capabilities, and investigative lead In February 2023, PRAC Chair Michael
generation for the PRAC Fraud Task Force, E. Horowitz testified along with other
DOJ COVID-19 Fraud Enforcement Task federal oversight leaders before the House
Force, and other OIG and law enforcement Committee on Oversight and Accountability
organizations. As of January 2024, the and the House Committee on Ways and
PACE has provided investigative support to Means and shared the benefits of using
more than 45 federal law enforcement and advanced data analytics to identify fraud
OIG partners in over 700 pandemic–related in pandemic relief programs. In November
investigations—all in less than four years 2024, Chair Horowitz testified to the
since the PRAC’s inception. With over 8,000 Senate Subcommittee on Emerging Threats
subjects and an estimated fraud loss of $1.87 and Spending Oversight, Committee on
billion associated with these investigations, Homeland Security and Governmental
the PACE has demonstrated a valuable return Affairs. The Chair encouraged Congress to
on investment. make the PACE permanent as a tool to help
watchdogs oversee all federal spending,
The PACE serves as a force multiplier including future emergency relief and
for the PRAC’s OIG and law enforcement recovery programs.
partners due to its ability to share data,
resolve entities (i.e., recipients) across data Beyond partnerships with federal
sources, and detect potentially suspicious agencies, the PRAC supports and coordinates
networks across agencies and programs. with state and local law enforcement. The
The PACE has access to 47 government, PRAC continues to hold quarterly briefings
public, and non-public data sets, and has with state and local officials, including law
established Memorandums of Understanding enforcement and auditing professionals, to
with 47 OIGs and law enforcement agencies share valuable insights on fraud indicators,
to prevent and detect improper payments patterns, and evolving schemes. Additionally,
and fraud across federal benefits programs. the PRAC focuses on empowering
Additionally, the PRAC has recruited, hired, individuals and whistleblowers to report
and placed 28 employees across the OIG alleged wrongdoing using the hotline on
community through its Data Science Fellows PandemicOversight.gov. To date, the PRAC
Program, providing partners with specialized has received over 9,000 hotline complaints
talent to help them conduct data analytics that have been routed to relevant agencies for
within their pandemic programs. further action as appropriate.
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INVESTIGATIVE AGENCIES
V. Department of Labor, Office of resources to the International Organized
Inspector General Crime Intelligence and Operations
Center, and engaging with public/private
The U.S. Department of Labor, Office alliances, such as the National Cyber-
of Inspector General (DOL-OIG) focused Forensics and Training Alliance.
on leveraging government partnerships and
private-sector relationships to: (i) bring DOL-OIG’s oversight of the UI
early pandemic UI fraud investigations to
program has resulted in 1,128
successful resolutions; (ii) complete high
impact audits concerning systemic issues criminal convictions with defendants
facing DOL and state workforce agencies sentenced to a collective 24,850
(SWAs) regarding pandemic UI programs, months in prison
and (iii) appropriately support the NUIFTF’s
and COVID-19 Fraud Enforcement Since the beginning of the pandemic,
Task Force’s (CFETF) efforts to identify DOL-OIG’s investigative efforts in this
significant pandemic fraud leads focused on space have continued to be unprecedented
complex criminal schemes; cases involving and include opening over 205,000 matters
substantial loss; street-level enterprises; and related to UI fraud, with approximately
transnational/international actors. To that 14,500 matters opened since August
end, DOL-OIG: 2022. Since April 1, 2020, the pandemic
UI investigative work by DOL-OIG has
• Provided training to thousands of yielded impressive results with the agency
internal and external stakeholders, such obtaining a total of 1,702 indictments/initial
as state auditors/comptrollers/treasurers, charges, executing over 850 search warrants,
chief financial officers, state and obtaining 1,128 convictions with over
federal UI program representatives, the 24,850 months of incarceration ordered, and
National Association of State Workforce more than $1 billion in monetary recoveries.
Agencies, the International Criminal Even amidst budget constraints, DOL-OIG
Police Organization, multi national law continues to expend significant resources
enforcement investigative teams, and addressing considerable post pandemic UI
foreign law enforcement partners; fraud issues with DOL and SWAs. Between
August 2022 and December 31, 2023, this
• Released multiple alerts and other has resulted in 512 individuals being charged
products to DOL, SWAs, and private- and another 531 defendants convicted of
sector partners; and crimes related to UI fraud. Between August
2022 and December 31, 2023, DOL-OIG’s
• Continued to bolster multi-directional UI investigations have resulted in more
intelligence sharing and investigative than $145 million in investigative monetary
leadership by dedicating additional results. DOL-OIG’s Offices of Investigation
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and Audit have conducted analyses and
audits of the UI program. During this time, SBA-OIG’s oversight of the PPP and
they have identified: state disbursements EIDL programs has resulted in 1,255
of $9.9 billion in pandemic UI benefits to indictments and 683 convictions
individuals likely committing fraud; $30.9
billion in suspicious UI payouts in six high- • A former reality television star was
risk categories; and continued activity by sentenced to more than 17 years in
organized criminal groups that are exploiting prison related to a Ponzi scheme and
UI programs by adapting their methods charges involving fraudulent PPP loan
to bypass safeguards and target system applications.
vulnerabilities. Additionally, DOL-OIG’s
criminal investigators, data scientists, and • A Texas man was sentenced to nine
analysts have substantially assisted in the years in prison for using fraudulently
generation and referral of approximately obtained PPP loans to purchase a
30 high-impact pandemic fraud leads to Lamborghini, Rolex, and other luxury
NUIFTF partner agencies across the United goods.
States.
• Members of a California fraud ring
Finally, the DOL Inspector General were convicted for using fake or stolen
provided congressional testimony on identities to submit approximately 150
multiple occasions, outlining the scope and fraudulent federal pandemic relief loans
magnitude of the historic levels of fraud, for sham businesses, for which they
waste, and abuse in pandemic UI programs. received more than $20 million.
More information related to DOL-OIG‘s Since March 2020, SBA-OIG has
pandemic work can be found on DOL-OIG’s initiated over 1,000 investigations involving
Pandemic Response website. complaints of fraud; received more than
270,000 SBA-OIG Hotline complaints; and,
VI. Small Business Administration, using data analytics, identified more than
Office of Inspector General 104,000 actionable leads. Given the extension
of the statute of limitations for SBA loan
Since 2020, SBA-OIG’s oversight of fraud related to the pandemic, SBA-OIG and
the PPP and EIDL programs has resulted in its law enforcement partners anticipate that
approximately 1,255 criminal indictments, the criminal and civil prosecution of these
985 arrests, and 683 convictions as of leads will continue for the foreseeable future.
December 31, 2023. SBA-OIG has identified
over $1B in forfeitable COVID fraud In addition to criminal and civil cases,
proceeds and more than $10B in disallowed SBA-OIG has worked to return more than
costs through audits and reviews. Some $28 billion in EIDL funds from financial
examples of SBA-OIG investigated fraud institutions and borrowers. And, because of
include:
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our oversight work published in OIG Reports, The FBI has initiated 364 COVID-19-
Report 23-16: Ending Active Collections on related health care fraud investigations into
Delinquent COVID-19 Economic Injury medical providers, laboratories, and others
Disaster Loans and Report 22-15 SBA’s engaging in health care fraud schemes,
Guaranty Purchases for Paycheck Protection including but not limited to overbilling
Program Loans, the agency has completed or “upcoding” for services, billing for
a comprehensive cost benefit analyses to services not rendered, performing and
substantiate the pursuit of collections on billing for medically unnecessary services,
$30 billion in EIDL and PPP loans under telemedicine/telehealth, fraud, kickback
schemes, and identify theft. The FBI has
$100,000.
also conducted industry-focused and public-
facing awareness campaigns about health
In June 2023, SBA-OIG published care fraud schemes related to the pandemic.
the COVID-19 Pandemic EIDL and PPP
Loan Fraud Landscape report due the
unprecedented levels of fraud in these Te FBI has arrested over 500
pandemic relief programs. The report defendants for PPP fraud and seized,
estimates that SBA disbursed over $200 recovered, forfeited, or prevented the
billion in potentially fraudulent COVID-19 loss of approximately $582.7M in PPP
EIDLs, EIDL Targeted Advances,
funds
Supplemental Targeted Advances, and PPP
loans.
The FBI launched initiatives to address
SBA-OIG, together with its law a range of fraudulent activity targeting
enforcement partners, continues to prioritize COVID-19 relief programs. As of September
the integrity, efficiency, and effectiveness 1, 2023, the FBI has opened approximately
of SBA programs. SBA-OIG’s response to 746 UI fraud-related cases and 481 EIDL
pandemic fraud to date demonstrates that investigations, seizing approximately $51
SBA-OIG, together with its law enforcement million in assets. As of the same date, the
FBI has opened over 1,800 PPP related cases
partners, provides independent, objective,
and arrested 518 individuals. The FBI has
and timely oversight of SBA while seeking
seized, recovered, forfeited, or otherwise
to return funds to the taxpayers where prevented the loss of approximately $582.7
appropriate and punish wrongdoers. million in PPP funds.
VII. Federal Bureau of Investigation For example, in 2022, a grand jury in
the Eastern District of Texas returned an
The Federal Bureau of Investigation indictment charging nineteen defendants with
continues to work in coordination with conspiracy to commit wire fraud in a case
the DOJ and federal, state, and local law jointly investigated by the FBI and IRS-CI.
enforcement and regulatory partners, as well The indictment alleges that the conspirators
as partners in the private sector, to detect and fraudulently applied for PPP and EIDL loans
disrupt COVID-19-related fraud. This work and obtained more than $3.5 million in SBA
spans multiple FBI Divisions and programs. pandemic relief funds.
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In another criminal case jointly undertaken million, and remitting over $400 million in
by the FBI and DOL-OIG, a defendant in the pandemic relief funds to date. The USSS
Northern District of California was sentenced partners with both the U.S. Department of
in July 2023 to 55 months in federal prison Justice (DOJ) Money Laundering and Asset
for using more than 136 stolen identities to Recovery Section (MLARS) and the U.S.
commit more than $2.6 million in UI fraud. Treasury Executive Office of Asset Forfeiture
(TEOAF).
In yet another pandemic fraud case jointly
investigated by the FBI, IRS-CI, and HSI,
a Texas man was sentenced to 180 months USSS has seized over $1.4B, forfeited
imprisonment after pleading guilty in the over $900M, and remitted over $400M
Northern District of Texas to fraudulently in pandemic funds
obtaining $4 million worth of PPP loans.
Throughout the pandemic, agents and The USSS plays a key role in the DOJ-
professional staff from the FBI participated in led NUIFTF. The USSS and our partners
the National Unemployment Insurance Fraud continue to investigate pandemic relief
Task Force (NUIFTF) and the International fraud. Between March 2020 and November
Organized Crime Intelligence and Operations 2023, USSS personnel initiated over 1,500
Center (IOC-2). Professional staff also investigations and over 2,500 investigative
assisted in processing complaints from the inquiries related to SBA loan and UI fraud.
National Center for Disaster Fraud (NCDF). For the same reporting period, USSS
The FBI has conducted numerous industry- investigations led to arrests of over 650
focused and public-facing awareness individuals for crimes related to SBA loan
campaigns about pandemic relief fraud. and UI fraud. For example, three Miami
These efforts included fraud awareness and residents were indicted in November 2023
training for financial institutions involved in in the Southern District of Florida for
SBA loans as well as agent-focused training submitting fraudulent PPP loan applications
on UI fraud. and obtaining $14.5 million in stolen funds
in an investigation USSS jointly worked with
VIII. U.S. Secret Service SBA-OIG. And 19 defendants were charged
in the Eastern District of Philadelphia for
In its continued effort to combat pandemic- collectively defrauding the PPP, EIDL, and
related fraud, the U.S. Secret Service (USSS) UI programs of more than $14 million in a
maintains strong working relationships with case investigated by USSS and six partner
federal law enforcement partners, such as agencies.
SBA-OIG, DOL-OIG, and USPIS, as well
as with financial institutions. The USSS In addition to investigations and asset
continues to use its administrative, civil- recovery, the USSS has provided insights on
judicial, and criminal forfeiture authorities lessons learned from the pandemic and fraud
seizing over $1.4 billion, forfeiting over $900 prevention. In February 2023, the Assistant
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Director of the Office of Investigations for
USSS also provided written testimony to IRS-CI has initiated ERC fraud
the House Committee on Oversight and investigations involving $2.9B
Accountability in February 2023, to discuss
USSS’ response to pandemic fraud.
As of the end of calendar year 2023, CI has
IX. IRS Criminal Investigation initiated 352 investigations involving more
than $2.9 billion in potentially fraudulent
Since the start of the of pandemic,
ERC claims in tax years 2020 through
IRS Criminal Investigation (IRS-CI) has
led and participated in COVID-19 fraud 2023. Eighteen of the 352 investigations
investigations covering a range of fraud have resulted in federal charges, with 11
typologies, including SBA pandemic loan convictions and four sentencings with an
fraud, counterfeit EIP checks, sale of average sentence of 21 months.
fraudulent PPE, UI Fraud, and tax-related
schemes connected to the pandemic. X. United States Postal Inspection
Service
Starting in 2023, IRS-CI has seen an
increase in fraud related to the Employee Between August 2022 and December
Retention Credit (ERC). Bad actors have 2023, the U.S. Postal Inspection Service
seized opportunities to personally benefit (USPIS) generated investigations that have,
from ERC claims using IRS Forms of the thus far, led to the arrest of more than 160
940 series (Employer’s Annual Federal people for federal offenses including PPP,
Unemployment (FUTA) Tax Return), 941-X EIDL, and UI fraud and involving losses of
(Amended Employer’s Quarterly Federal Tax more than $283 million.
Return) series, and 7200 (Advance Payment
of Employer Credits Due to COVID-19). IRS-
CI has continued to conduct data analytics to USPIS worked to bring charges
develop investigative leads focused on ERC against 160 people for over $279M in
fraud. pandemic fraud
IRS-CI has been proactive in conducting
media and stakeholder outreach to inform
taxpayers and tax-professionals of COVID- For example, in the Eastern District of
related fraud and scams. In February of Virginia, a defendant was sentenced to 42
2024, IRS-CI began hosting a series of months in prison in February 2024 for his
educational sessions geared specifically role in receiving fraudulent EIDL loans using
to tax professionals about ERC at its field the identities of others. In another case, three
offices across the country. These sessions are individuals were sentenced for their roles in
part of a nationwide initiative to ensure that fraudulently obtaining $3.5 million in PPP
tax professionals have the latest information loans.
about ERC claims and understand ERC
eligibility criteria.
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USPIS has conducted robust COVID-19- Medicare Fraud Strike Force to make the
related fraud prevention activities through a greatest possible impact, recover stolen
variety of mediums, including and not limited dollars, and bring wrongdoers to justice.
to, social media postings, public service
announcements, and a dedicated COVID-19 HHS-OIG’s Division of Data Analytics
webpage that provides information and has focused on proactive data analysis to
prevention tips on various COVID-19 related identify potential fraud in the pandemic
fraud schemes. USPIS also created internal space. Agents have also worked closely
informational messaging on recognizing and with the Health Resources and Services
reporting fraud schemes, including those Administration (HRSA) – which managed
stemming from COVID-19 related fraud, the PRF and UIP programs – to highlight bad
for the U.S. Postal Service’s over 600,000 actors and provide subject matter experts to
employees nationwide. assist with investigations and prosecutions.
XI. Department of Health and These collaborative efforts have resulted
Human Services Office of in several impactful cases. For example:
Inspector General
• In March 2023, a Grand Jury in the
The COVID-19 pandemic represented Northern District of Illinois returned an
a unique opportunity for fraudsters to take indictment charging a Chicago-area lab
advantage of federal health care benefit owner with the fraudulent submission of
programs, including Medicare and Medicaid. claims to HRSA for COVID-19 testing,
In response to the pandemic, HHS created resulting in the receipt of over $83
two new benefit programs – the Provider million.
Relief Fund (PRF) and Uninsured Program
(UIP) – both of which were targeted by • In September 2023, a Los Angeles-
individuals and organized criminal groups area doctor and his coconspirators
seeking to commit fraud. were charged with defrauding HRSA’s
COVID-19 Uninsured Program. The
HHS-OIG’s investigations resulted indictment alleges that the conspirators
received approximately $150 million
in 290 indictments, 135 criminal
in payments for services not covered or
convictions, and $477M in monetary never provided.
recoveries
• In January 2024, a California man
HHS-OIG has conducted COVID-19 was sentenced to ten years in prison for
investigations resulting in 290 indictments, his involvement in operating a laboratory
135 criminal convictions, and monetary and billing Medicare approximately $234
recoveries of $477 million. Agents have million for various lab tests, including
leveraged established relationships with COVID-19 tests, despite being excluded
United States Attorneys’ Offices and DOJ’s from Medicare.
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HHS-OIG has received thousands of Between September 1, 2022, and
allegations of pandemic fraud through its February 28, 2024, SIGPR’s investigations
Hotline (800-HHS-TIPS or https://tips.oig. resulted in 21 arrests, 21 individuals
hhs.gov). Agents have conducted outreach being charged, and four individuals being
to groups such as the Healthcare Fraud sentenced to between one and seven years
Prevention Partnership and National Health of incarceration. The sentencings included
Care Anti-Fraud Association to educate restitution orders totaling more than $11
public and private insurers about pandemic million and forfeiture orders totaling nearly
fraud schemes. HHS-OIG has also worked $10 million. For example, SIGPR, together
closely with DOJ’s COVID-19 Fraud with the FBI, IRS-CI, and Federal Reserve
Enforcement Task Force to bring all possible Board OIG, investigated a convicted felon
resources to bear to combat health care fraud who fraudulently obtained more than $2.6
involving government programs. million from the Main Street Lending, PPP,
and EIDL programs. The defendant, who
XII. Department of the Treasury was prosecuted in the Middle District of
Special Inspector General for Florida, was sentenced to more than seven
Pandemic Recovery years in federal prison and ordered to pay
over $2.617 million in restitution. SIGPR
The Special Inspector General for also partnered with FDIC-OIG and the FBI
Pandemic Recovery (SIGPR) is an IG created to investigate several individuals for PPP
by the CARES ACT of 2020 to investigate fraud in a matter initiated by the PRAC. The
matters arising from three types of CARES investigation resulted in fourteen defendants
Act loans: (1) Treasury’s Direct Loans to air being charged with fraud in the Northern
carriers and businesses critical to maintain District of Texas for allegedly filing a total of
national security; (2) Treasury’s investments 29 fraudulent PPP and bank loan applications
into loans made as part of the Main Street totaling more than $50 million.
Lending Program (MSLP); and (3) PPP
loans referred by the PRAC to SIGPR for During the same period, SIGPR opened
investigation. Because no principal is due on 28 new investigations and referred 22
the Treasury Direct Loans until 2025, and the individuals to Treasury’s Suspension and
first 15% principal payments were not due on Debarment Office; seven of which have been
the MSLP loans until the latter part of 2023 debarred to date. SIGPR’s investigations
and early 2024, SIGPR developed more than have also led to recoveries in the form of
85% of its case leads proactively. early loan repayments totaling more than
$21 million.
SIGPR investigations led to 21 arrests, SIGPR’s Inspector General, Brian Miller,
$11M+ in restitution orders, and has testified before Congress and engaged
in outreach among accountants, lawyers,
nearly $10M in forfeitures
and other IGs concerning CARES Act
fraud. On November 14, 2023, IG Miller
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testified before the Senate Subcommittee on 160 indictments, and 127 convictions while
Emerging Threats and Spending Oversight seizing approximately $7.5 million related to
hearing “Examining Federal COVID-Era COVID-19 fraud.
Spending and Preventing Future Fraud.”
Since August 2022, HSI has
XIII. Treasury Inspector General supported 127 convictions and seized
for Tax Administration approximately $7.5M related to
COVID-19 fraud
The Treasury Inspector General for Tax
Administration (TIGTA) has been involved
in numerous Federal criminal investigations HSI investigations have resulted in
since the beginning of the pandemic. During indictments for pandemic relief benefit
fiscal year 2023, 269 individuals were charged fraud, including PPP and EIDL, as well as
in connection with COVID-19 benefit fraud UI fraud, counterfeit PPE, and seizures of
as a result of TIGTA investigations, bringing fraudulent proceeds of those offenses. HSI
the total since March 2020 to 672. Of agents are participating in pandemic relief
those individuals, 266 were sentenced and fraud task forces across the country, as well
collectively received a total of more than as the National Unemployment Insurance
754 years imprisonment and court-ordered Fraud Task Force.
financial restitutions of almost $159 million.
For example, TIGTA investigated a case in XV. Federal Deposit Insurance
the Northern District of Georgia that led to Corporation Office of Inspector
22 people being indicted for a $3.8 million General
PPP fraud scheme.
Since many pandemic-relief programs
XIV. Homeland Security are administered through Federal Deposit
Investigations Insurance Corporation (FDIC) regulated
and insured institutions, the FDIC Office
Since April 2020, Homeland Security of Inspector General (OIG), Office of
Investigations (HSI) Cyber Crimes Center Investigations (OI) has been actively involved
(C3), Intellectual Property Rights Center in pandemic-related financial investigations
(IPRC), Financial Crimes Unit (FCU), and that affect the institutions. The FDIC-OIG’s
HSI Office of Intelligence representatives efforts related to the federal government’s
have been successfully targeting online fraud COVID-19 pandemic response have
schemes and the sale of illicit COVID-19 resulted in approximately 196 investigations
vaccines and treatments using illicit websites associated with fraud in pandemic relief
and dark net marketplaces as well as COVID- programs. Such cases involve fraudulent
19-related financial fraud. From August activity involving theft of funds from
1, 2022, through September 30, 2023, HSI Government programs intended to provide
Special Agents have initiated 174 criminal financial assistance during the pandemic.
investigations, made 175 arrests, secured Since the beginning of the pandemic, the
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FDIC-OIG’s collaborative work in this for-profit, post-secondary school that closed
area has accounted for 77 complaints, who closed returned more than $235,000
248 indictments or informations, 192 in HEERF. In another case, a for-profit
convictions, 257 arrests, and approximately school was denied additional eligibility in
$271 million in fines/penalties, restitution the Federal student aid programs because
ordered asset forfeitures, and asset seizures. it improperly accounted for and disbursed
Some examples of FDIC-OIG-supported HEERF awards to students and did not meet
matters include: the standards of financial responsibility for
administering the programs.
• Leader of $20M COVID-19 Relief
Fraud Ring Sentenced to 15 Years The OIG also continues to distribute
fraud awareness materials aimed at helping
• CFO, Controller, Corporate Officers stakeholders identify and report suspected
Charged in $53 Million Fraud Scheme fraud involving pandemic relief aid. This
Involving Pandemic Relief includes a digital booklet and a one-page
flyer. The materials highlight what education-
XVI. Department of Education related coronavirus fraud could look like and
Office of Inspector General provide information on free resources to help
identify and report fraud to the OIG. Further,
The U.S. Department of Education Office the OIG continues to participate in Federal-
of Inspector General has been working since State COVID-19 task forces and work groups.
2020 to identify and stop fraud, waste, and These task forces are a collective of Federal
abuse of pandemic aid. An investigation and State law enforcement and prosecutive
with its law enforcement partners led to the entities combining their investigative power
sentencing of a U.S. Army Chief Warrant to quickly address fraud complaints and to
Officer for leading a “prolific fraud scheme” identify, investigate, and prosecute fraud
in which she and others illegally raked in related to the pandemic. Further, the OIG
millions of dollars from COVID-19 relief continues to participate in the PRAC and
programs and federal student loan forgiveness. other Federal-State COVID-19 task forces
The warrant officer submitted more than 150 and work groups.
fraudulent PPP loan applications to the Small
Business Administration for herself and XVII. Department of Veterans
others, resulting in more than $3 million in Affairs Office of Inspector
fraudulent disbursements. Conspirators paid General
the defendant to submit falsified certifications
to discharge of more than a dozen student The U.S. Department of Veterans Affairs
loans totaling more than $1 million. Office of Inspector General (VA- OIG)
continues to participate in multiple federal
OIG efforts also led to schools returning criminal investigations related to pandemic
Higher Education Emergency Relief Fund fraud. From August 2022 through December
(HEERF) awards, including the owner of a 2023, VA-OIG investigations have resulted
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in 14 federal indictments or informations, loan fraud. Agents from OIGs across the
over $3 million in ordered restitution federal government, including the DOJ-
and forfeiture from defendants, and OIG, have been detailed to work on task
approximately $95 million in cost savings force cases. These agents have partnered
and avoidances. During this reporting period, with prosecutors from the Department’s
VA-OIG COVID-19-related investigations Criminal Division, Fraud Section, and
included alleged bribery and kickback United States Attorney’s Offices across the
schemes related to fraudulent COVID-19 country. Since August 2022, the OIG has
testing, fraudulent procurement practices actively investigated multiple PRAC Fraud
regarding personal protective equipment, Task Force cases, which are in various stages
and fraudulent Paycheck Protection Program of investigation and prosecution. Some of
(PPP) loans and Economic Injury Disaster the subjects in these cases have already been
Loans (EIDL) received by VA employees. sentenced. For example, on October 23,
For example, in the Western District of New 2023, a defendant in a PRAC Fraud Task
York, a man was sentenced to more than 20 Force case investigated by the OIG was
years engaging in multiple fraud schemes, sentenced to 25 years’ imprisonment and
including obtaining $7.4 million by falsely ordered pay $1,120,462 in restitution for
purporting to have N95 masks that he could using stolen identities to fraudulently obtain
sell to various entities, including a VA PPP and EIDL loans. In addition, DOJ OIG
hospital, during the height of the pandemic. uses proactive data analytics to identify and
investigate pandemic-related contract fraud
XVIII. Department of Justice and fraudulent receipt of PPP and EIDL
Office of Inspector General loans by individuals within its jurisdiction.
The DOJ-OIG has devoted a significant DOJ-OIG-supported PRAC investigation
portion of its oversight work since March resulted in defendant sentenced to 25 years’
2020 to assessing the DOJ’s readiness to imprisonment for PPP fraud
respond to the COVID-19 pandemic. This
has included oversight of pandemic-related The DOJ-OIG also has issued several
grant funding disbursed to state, local, and oversight products related to the COVID-19
tribal organizations, as well as the release pandemic, since August 2022. For example,
of a collection of interactive dashboards in September 2022, DOJ-OIG issued an
with data on COVID-19 case trends, testing Audit of the Management and Coordination
trends, and deaths due to COVID-19 in BOP- of Pandemic-Related Fraud Allegations and
managed correctional facilities. Referrals Between the Criminal Division and
Executive Office for U.S. Attorneys, which
In January 2021, PRAC stood up a Fraud contained recommendations to improve the
Task Force to serve as a resource for the DOJ’s efforts to combat COVID-19 fraud. In
Inspector General community by surging addition, since August 2022, the DOJ-OIG
investigative resources in those areas where has contributed to two joint products with the
the need is the greatest, currently pandemic PRAC Health Care Subgroup.
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XIX. Department of Homeland Unemployment Assistance by using stolen
Security, Office of Inspector identities.
General
XX. Department of Defense Office
The Department of Homeland Security, of Inspector General
Office of Inspector General (DHS-OIG)
expanded its COVID-19 Fraud Unit, The DoD office of Inspector General
comprised of experienced special agents, (DoD-OIG) is responsible for auditing,
program analysts and data scientists, to evaluating, and investigating the programs
develop proactive initiatives to identify and operations of the Department of Defense.
COVID-19 fraud and conduct COVID-19 Congress appropriated approximately
fraud investigations. The DHS-OIG and its $10.6 billion for the DoD to respond to the
investigative partners focused on international COVID-19 pandemic. The DoD-OIG’s
fraud rings, public trust employees, and criminal investigative component, the
groups of already-incarcerated prison Defense Criminal Investigative Service
inmates defrauding the government’s UI (DCIS), initiated investigative projects
programs. nationwide to identify fraud in DoD
acquisition and health care programs related
DHS-OIG investigations have resulted to the DoD’s response to the COVID-19
in 87 criminal convictions and over pandemic.
$20M in recoveries
Since 2021, DCIS’s COVID-19 and
CARES ACT fraud investigations have led
DHS OIG has opened over 553 high to the arrest of 80 subjects, leading to the
impact investigations, including an inquiry conviction of 66 individuals and resulting in
into a Nigerian fraud ring based in Maryland approximately 2,300 months of confinement
that defrauded several State Workforce and probation. From FY 2021 through 2023,
Agencies of over $3.2 million. To date, combined civil and criminal penalties, fines
DHS-OIG investigations have resulted in and restitutions totaled $68,812,391.
approximately 126 indictments, 30 criminal
informations, 87 convictions, and more than DCIS continues to make strides and
$21.5 million in recoveries. advances investigating CARES ACT fraud.
DCIS HQ components collaborated with
In one DHS-OIG case, a Missouri experienced field agents to produce the
woman was sentenced to 30 months in “PPP/EIDL Investigative Guidebook.”
federal prison for facilitating the filing of The guidebook provides DCIS agents
false claims for unemployment benefits by suggestions and offers effective tips on how
using the stolen identities of incarcerated to conduct investigations into PPP and EIDL
individuals. In another case, a Connecticut fraud. During year two, DCIS continued
man was sentenced to four years in prison to work collaboratively with other federal
for fraudulently obtaining Pandemic law enforcement partners including, the
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Department of Justice, the Military Criminal fraud related to the lending facilities that are
Investigative Organizations (MCIOs) central to the Board’s pandemic response.
and with CIGIE, providing significantly Since the start of the pandemic, our work
increased results. has resulted in 157 investigations, 93 arrests,
83 convictions, and nearly $194 million
The DoD encourages the use of the in criminal fines, restitution, and special
DoD Hotline (www.dodig.mil/hotline) to assessments.
report concerns related to fraud affecting
DoD equities, including responses to the XXII. INTERPOL Washington,
COVID-19 pandemic. The hotline provides
a confidential, reliable means to report fraud,
the United States National
waste, abuse, and other violations of law that Central Bureau
involve the Department of Defense, without
fear of reprisal. INTERPOL Washington, the United
States National Central Bureau (USNCB),
XXI. Federal Reserve Board is actively supporting domestic and
international efforts to combat COVID-19
The Federal Reserve Board has played related fraud. Conducted in coordination with
a vital role in response to the pandemic law enforcement authorities in the U.S. and
by enforcing federal consumer protection the 195 other INTERPOL member countries,
laws and protecting consumers from abuse. the USNCB’s support activities include, but
FRB coordinates with U.S. Government are not limited to, sharing investigative leads
Accountability Office; the PRAC, SIGPR, and referrals, participation in multi-national
SBA-OIG, and other offices of inspector enforcement and interdiction operations,
general to ensure robust oversight of the and the production and dissemination
Board’s pandemic response activities, and of INTERPOL Notices alerting law
FRB oversees the CFPB’s pandemic response enforcement authorities to fraud arising from
activities through our reviews, to efficiently the pandemic.
deploy resources where they are most needed.
FRB’s Inspector General Bialek is a member In October 2023, the USNCB participated
of the PRAC Financial Sector Oversight in Operation PANGEA XVI, an INTERPOL-
Subcommittee and serves as the vice chair coordinated operation intended to disrupt the
of the PRAC Investigations Subcommittee. activities of organized criminal networks
FRB’s Office of Investigations is dedicated distributing illicit and counterfeit COVID-19
to identifying and investigating potential pharmaceuticals and medical supplies online.
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LESSONS LEARNED
Our Work is Not Over There are indicators that the domestic and
foreign networks who committed COVID-19
The results of the government’s collective fraud continue to attack federal and state
response to COVID-19 fraud detailed in this programs, applying criminal skills and tools
report shows the tremendous results possible they acquired during the pandemic to commit
when agencies work together, particularly fraud. The government is also regularly a
given the limited upscaling of investigative victim of cyber-enabled fraudsters in ways
and prosecutorial resources. But our work to beyond identity theft, including by invoice or
punish wrongdoers and recoup fraudulently payment fraud related to federal funds, such
obtained pandemic relief funds is far from as impersonating contractors to fraudulently
over. State workforce agencies continue to receive payments or business email
provide additional claims data that has yet compromise. As evidenced by numerous
to be analyzed for leads. The NUIFTF data examples around the country, some of which
scientists and analysts continue to make are detailed in this report, domestic violent
connections from law enforcement data to criminal groups are also turning to identity
identify perpetrators of fraud. Funds stolen and government benefit theft. This both
from pandemic relief programs remain heightens the need to improve our response
restrained in bank accounts and need to be and demonstrates that thwarting government
forfeited. Accordingly, the CFETF strongly benefit fraud can support efforts to reduce
supports an extension of the statute of violent crime in our communities.
limitations for COVID-19 pandemic benefit
fraud, an extension of the data sharing and Fraudsters are increasingly anonymous;
analysis facilitated by the PRAC, and the detection of the perpetrators and tracing of
necessary resources for CFETF members the money is impossible for a single agency
to continue their impressive work holding or agent. The benefits from the relationships
fraudsters accountable and recovering stolen and data sharing forged in response to
funds. pandemic fraud are readily apparent.
Explore Permanent Coordinated The members of the CFETF stand
Efforts to Combat Government ready to engage with the relevant policy
Benefits Fraud makers to discuss ways to improve our
data sharing and a coordinated response to
The response to COVID-19 fraud government benefits fraud going forward,
has made the members of the CFETF including creating an ongoing data-sharing
keenly aware of the need for a permanent, and analytics entity. CFETF members are
interagency body to respond to government also eager to discuss the resources needed
benefits fraud. The use of stolen and to address this growing threat; we must have
synthetic identities by criminal networks to the agents, analysts, and prosecutors in place
defraud public benefits programs is a serious to analyze data, generate actionable leads,
and evolving threat to the integrity of federal and prosecute these complex cases.
programs and to the American people those
essential programs are intended to help.
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