DOJ recovers $1.4 billion and files charges against 3,500 individuals for pandemic aid fraud

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According to officials, the Justice Department’s COVID-19 Enforcement Task Force has made significant progress over the past three years. They have successfully charged over 3,500 individuals with federal crimes, recovered a remarkable $1.4 billion in stolen pandemic funds, and resolved over 400 civil settlements and judgments.

White House officials and lawmakers seized the opportunity presented by the announcement to put forth legislation aimed at increasing funding for anti-fraud enforcement, extending the statute of limitations on prosecuting crimes, and enhancing government databases to more effectively identify instances where payments should not be authorized.

Attorney General Merrick Garland assured reporters on Tuesday that the investigation and prosecution of pandemic relief fraud would persist, with a focus on recovering the assets that have been unlawfully taken from American taxpayers.

Investigations found false billings and siphoning money from children’s meals

Fraud investigations encompass a wide range of cases, and here are a few examples:

    • Federal charges unveiled in September 2022 against 47 people accused of siphoning $250 million from a coronavirus pandemic relief program designed to provide meals for children, in “a brazen scheme of staggering proportions.”
    • A sweep of suspects including doctors, marketers and manufacturers of fake vaccination cards in April 2022 resulted in charges against 21 people accused with $149 million in false billings and theft from government programs.
    • Fifteen of the largest and hardest-hit states awarded hundreds of millions of dollars in sole-sourced, non-competitive awards went to vendors for items such as masks that have been accused of defrauding taxpayers, a USA TODAY investigation found .
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Lawmakers, White House call for legislation to expand fraud enforcement

Democratic senators and White House officials argued on Tuesday for the necessity of legislation to continue the battle against COVID fraud. During the unveiling of a new bill, they included provisions specifically designed to combat such fraudulent activities.

According to Senator Gary Peters, a Democrat from Michigan and the chair of the Homeland Security and Governmental Affairs Committee, the pandemic has resulted in an unprecedented surge in fraudulent activities. He stated that unscrupulous individuals have exploited the crisis to benefit themselves financially.

Here are the proposals:

    • Tripling the funding to $300 million for prosecution teams coordinating pandemic fraud investigations.
    • Raising the cap on penalties in civil fraud cases to $1 million from $150,000.
    • Providing $250 million to the Small Business Administration and Labor Department inspectors general to identify and recover fraud.
    • Extending the statute of limitations on pandemic unemployment insurance fraud to 10 years from five years.

“The extension of the statute of limitations, along with securing the essential funding and data analytic tools, is crucial for our prosecutors to successfully recover hundreds of millions of dollars in fraud proceeds, ensure that all remaining offenders are held accountable, and effectively disrupt criminal networks that persistently victimize our citizens,” stated Deputy Attorney General Lisa Monaco.

Sen. Ron Wyden, D-Ore., who chairs the Finance Committee, emphasized the significance of a provision that aims to establish a Social Security number verification system as a means to combat identity theft.

“This is a true epidemic,” stated Wyden, emphasizing the severity of the situation. He further added, “Identity theft has affected millions of Americans, making it a critical issue.”

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According to Gene Sperling, Senior Adviser to President Joe Biden and Coordinator of the American Rescue Plan, it is crucial to allocate funding for multiple years to hire skilled investigators capable of pursuing highly sophisticated criminals.

Sperling emphasized the importance of pursuing highly sophisticated criminals and criminal syndicates who have exploited our system to the fullest. In order to effectively combat such threats, he argued that extending the statute of limitations alone is insufficient. It is equally crucial to provide enforcement and oversight agencies with the necessary resources and security to engage in long-term hiring. According to Sperling, failing to do so could result in the loss of valuable personnel.

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