/>iHeadlines that Matter for Companies and Executives in Regulated Industries
Guilty Plea in $250 Million Federal Child Nutrition Fund Fraud Scheme
A man from Brooklyn Park, Minneapolis, Minnesota, pled guilty for his involvement in a $250 million fraud scheme that exploited a federally-funded child nutrition program.
The defendant enrolled two organizations — Community Enhancement Services and Lake Street Kitchen — in the Federal Child Nutrition Program as organizations that provided meals to underprivileged children. Between February and October 2021, Community Enhancement Services falsely claimed to have served over 800,000 meals to underprivileged children, while Lake Street Kitchen falsely claimed to have served over 70,000 meals from December 2020 to April 2021. The fraudulent claims were supported by falsified invoices showing the purchase of food and falsified attendance rosters showing the supposed names of meal recipients.
As a result of the fraudulent claims, the organizations received $1,783,786.45 in Federal Child Nutrition Program funds from Feeding our Future, their sponsor entity. The defendant obtained $712,084.00 in fraud proceeds for himself and his entities. As part of his plea agreement, the defendant agreed to forfeit the $712,084.00, a boat and trailer, a Ford F-150 pickup truck, an apartment in Nairobi, Kenya, and a Kenyan resort complex located on the Indian Ocean.
Read US Department of Justice’s (DOJ) press release here.
SDFL Unseals Indictments in Florida Nursing Scheme
Twenty-five defendants were recently charged in the Southern District of Florida for their participation in a wire fraud scheme to sell over 7,600 fraudulent nursing degree diplomas and transcripts. The government alleges that purchasers of the diplomas and transcripts used them to sit for a national nursing board exam, and upon passing, to obtain jobs and licenses as registered nurses and/or licensed/practical/vocational nurses. Each defendant could be sentenced to a maximum of 20 years’ imprisonment.
Read DOJ’s press release here.
Covid-19 CARES Act Fraud
A man from Maine pled guilty to wire fraud and money laundering as a result of his unlawful receipt of Economic Injury Disaster Loan (EIDL) and Paycheck Protection Plan (PPP) monies, and was sentenced to 33 months’ imprisonment. The defendant fraudulently received $177,400 in EIDL funds as a result of numerous false representations within two fraudulent loan applications. The defendant then used the EIDL funds for personal purposes, including retaining a criminal defense attorney in a different case, posting bail, and purchasing a pickup truck. The defendant also received a $145,000 PPP loan after he submitted a fraudulent loan application to a private lender that contained falsified IRS documents and forged statements from his checking account. He spent the PPP monies on another vehicle, as well as online purchases and other living expenses.
Read DOJ’s press release here.
Additionally, a Baltimore, Maryland man was charged with wire fraud in connection with his submission of fraudulent applications for unemployment insurance benefits under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. According to DOJ’s press release, the defendant made misrepresentations, false statements, and omissions regarding his employment, eligibility to receive unemployment insurance benefits, and his alleged businesses, and submitted a fake tax form in support.
Read DOJ’s press release here.
Governor of Maryland’s Office on Service and Volunteerism Resolves False Claims Allegations
The Maryland Governor’s Office on Service and Volunteerism (GOSV) agreed to pay $639,916 to the federal government to resolve an investigation into the operation and administration of the state’s AmeriCorps program. According to DOJ’s press release, the GOSV overstated its expenses and violated AmeriCorps grant requirements, such as charging salaries without timesheets or time records, and doling out tickets to Orioles games and the Maryland State Fair meant for AmeriCorps volunteers.
Read DOJ’s press release here.
