Virginia’s Top Federal Prosecutors Join Forces to Combat Fraud Related to COVID-19
Virginia’s top federal prosecutors have teamed up to fight potential fraud in connection with the COVID-19 pandemic. The Virginia Coronavirus Fraud Task Force, led by Thomas T. Cullen, United States Attorney for the Western District of Virginia, and G. Zachary Terwilliger, United States Attorney for the Eastern District of Virginia, in partnership with the Federal Bureau of Investigation and Virginia State Police, was established to identify, investigate, and prosecute fraud related to the ongoing COVID-19 pandemic in Virginia.
Last week, the Task Force sent letters to the CEOs of all major hospital systems across the Commonwealth to alert them to potentially fraudulent and illegal activity associated with the COVID-19 pandemic. These letters apprised hospital leadership of the potential criminal consequences of hoarding certain health and medical supplies, including portable ventilators, face masks, surgical masks, gloves, face shields, other personal protective equipment, and other supplies identified as scarce in a March 23 Executive Order signed by President Trump. The letter also asks hospital administrators to “identify those individuals or entities that may have acquired vital medical supplies in excess of what they would reasonably use or for the purpose of charging exorbitant prices.”
“Our regional health systems and the brave men and women they employ have a unique vantage point from which to detect potentially fraudulent and illegal hoarding activity associated with COVID-19,” said United States Attorney Cullen. “It is our hope that these institutions will partner with us to combat criminal conduct that undermines our collective efforts to slow the spread of this disease.”
“It is imperative that we get these critical materials to the people on the front lines,” said United States Attorney Terwilliger. “If you are someone who is looking to unjustly enrich yourself off of this pandemic, and amassing bulk quantities to unfairly extort hospitals and others, we will investigate and take all next steps to ensure these critical supplies get where they are needed most.”
“Governor Northam and his administration have no tolerance for any kind of fraudulent activity occurring in Virginia related to the COVID-19 pandemic,” said Virginia Secretary of Public Safety and Homeland Security Brian Moran. “At a time when the accessibility of specific, life-critical health and medical supplies are imperative to the mitigation of COVID-19 within our communities, Virginia is appreciative of our federal partners bringing these concerns to light.”
In addition to the letters to hospitals, the Task Force also has alerted Virginia taxpayers to possible scams relating to COVID-19 economic impact payments.
Partnerships like the Virginia Coronavirus Fraud Task Force have formed across the country in response to United States Attorney General William Barr’s March directive to all United States attorneys’ offices to prioritize prosecuting fraud cases relating to the COVID-19 pandemic, including in Florida, New Jersey and Pennsylvania. 1 Enforcement actions already have begun:
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On March 22, the Department of Justice filed its first COVID-19-related fraud action in federal court in Austin, Texas, obtaining a civil restraining order against the operators of the website www.coronavirusmedicalkit.com, based on the alleged sale of fake World Health Organization vaccine kits.
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On March 30, the United States Attorney’s Office for the District of New Jersey brought the DOJ’s first criminal case relating to the pandemic, charging a Georgia man for allegedly taking kickbacks to gather Medicare patients for unnecessary COVID-19 testing – including the defendant telling a cooperator that “everybody has been chasing the COVID dollar bird.”
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On April 10, a Georgia man was arrested on fraud charges from the District of Columbia for allegedly attempting to sell millions of nonexistent respirator masks to the Department of Veterans Affairs in exchange for large upfront payments.
Investigations and enforcement actions will continue for the weeks, months, and years to come following the pandemic. If you wish to discuss these enforcement actions, or if you would like advice about other civil or criminal enforcement matters, please contact one of our White Collar Government and Investigations team members.
1 https://www.justice.gov/usao-nj/pr/us-attorney-carpenito-ag-grewal-acting-comptroller-walsh-announce-federal-state-covid-19; https://www.justice.gov/usao-wdpa/pr/us-attorney-scott-brady-and-pennsylvania-attorney-general-josh-shapiro-announce;
https://www.justice.gov/usao-sdfl/pr/us-attorney-ariana-fajardo-orshan-launches-task-force-investigate-and-prosecute-covid