The Department of Justice (DOJ) and various state agencies have announced that they will aggressively pursue fraudulent schemes related to COVID-19. On March 16, Attorney General William Barr directed all U.S. Attorney’s Offices to prioritize the detection, investigation, and prosecution of all criminal conduct related to the Coronavirus pandemic. Each office was directed to appoint a COVID-19 fraud coordinator to serve as the liaison between the local Department of Justice and their state and local counterparts.
Based upon that directive, the U.S. Attorney for New Jersey and the New Jersey Attorney General just announced the formation of a joint federal-state task force to investigate and prosecute a wide range of misconduct arising from the COVID-19 pandemic, including the unlawful hoarding of medical supplies, price gouging, charity scams, procurement fraud, insurance fraud, phishing schemes, and false and misleading investment opportunities.
On March 21, the first enforcement action was filed in the Western District of Texas against the operators of a website purporting to sell World Health Organization vaccine kits. Those kits are alleged to be fake. In this instance, the Department of Justice filed a civil injunction to immediately block public access to the website and restrained the operators from selling the allegedly false kits. A criminal investigation will likely follow the civil injunction.
On March 30, the U.S. Attorney in the District of New Jersey filed criminal charges against a Georgia man for his alleged role in a Coronavirus-related healthcare scheme. Specifically, it is alleged he and others defrauded health care benefit programs by submitting fraudulent testing claims for COVID-19 and genetic cancer screenings. The complaint alleges that the defendant offered kickbacks in exchange for medically unnecessary tests, including hard-to-obtain COVID-19 tests, coupled with a much more expensive respiratory pathogen panel test (RPP) that does not identify or treat COVID-19.
These are just the beginning of what will likely be a wave of federal and state prosecutions for fraudulent schemes that prey on people’s fears of this pandemic. The Department of Justice announced that it will be investigating price gouging for masks, hand sanitizer, and other personal protective items; phone scams by those pretending to be doctors or hospitals claiming to have treated family members and seeking payment; robocalls offering fake treatments; fake charities seeking donations; cyber crimes like malicious websites and apps that claim to share COVID-19 information, but in reality seek and steal user information; and health care fraud, such as the schemes detailed above.
Heath care fraud is a Department of Justice priority even during “normal” times. Now, with the pandemic, new investigations and prosecutions will rapidly expand as people look to take advantage of the public health crisis.
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