As we anticipated last spring, the Department of Justice (DOJ) has signaled that it will utilize civil enforcement of the False Claims Act (FCA) to address new and emerging cybersecurity threats. On October 6, 2021, Deputy Attorney General Lisa Monaco announced the launch of a new cyber-fraud initiative led by the Fraud Section of DOJ’s Commercial Litigation Branch. The new initiative will focus FCA enforcement against federal government contractors or grant recipients who fail to follow required cybersecurity standards.… More
Tag Archives: Department of Justice
In the past two weeks, the federal government has charged several individuals in Paycheck Protection Program loan fraud schemes. The allegations have ranged from applying for loans for non-operating businesses to using loan funds to buy cars and jewelry. Charges announced this week showed a whole new level of creativity. A Texas man, Samuel Yates, allegedly used an online name generator to make up the names of hundreds of employees in an effort to obtain a $5 million loan. … More
In yet another sign that the federal government is following through on its warnings about PPP loan fraud, the Department of Justice, according to reports from Reuters, has issued grand jury subpoenas to several Wall Street banks related to an investigation into PPP loans. The subpoenas were reportedly issued by the DOJ’s Fraud Section. The issuance of the subpoenas does not necessarily indicate wrongdoing by the banks. … More
Federal prosecutors continued to quickly respond to PPP loan fraud, bringing two additional cases that allege clear misuse of the funds intended for small businesses. In one case, prosecutors in Georgia charged reality TV personality Maurice Fayne, aka “Arkansas Mo” of “Love & Hip Hop: Atlanta” fame, with bank fraud for allegedly using $1.5 million of a $2 million PPP loan to maintain his luxury lifestyle. … More
On Tuesday, May 5, the Department of Justice (DOJ) filed charges in the federal District Court of Rhode Island against David A. Staveley and David Butziger for conspiracy to make a false statement and conspiracy to commit bank fraud in connection with loan applications made under the federal government’s Payroll Protection Program (PPP). The Complaint alleges that Staveley of Andover, Massachusetts, and Butziger of Warwick, Rhode Island,… More
The United States Attorney for the District of Massachusetts is proactively seeking to find, investigate, and prosecute unlawful attempts to exploit the COVID-19 pandemic and is asking hospitals to assist. U.S. Attorney Andrew Lelling sent a letter to leaders of Massachusetts hospitals asking them to report any “individuals and companies that may have acquired vital medical supplies in excess of what they would reasonably use, or for the purpose of charging exorbitant prices.” The Secretary of Health and Human Services has designated 15 categories of supplies as “scarce,” thereby enabling prosecutors to seek certain civil and criminal enforcement remedies against anyone accused of hoarding or gouging prices for those supplies. … More
The recently-reported sales of stock by several U.S. Senators following private briefings on the COVID-19 pandemic, apparently allowing them to avoid significant losses before the markets plummeted, have focused attention on the Stop Trading on Congressional Knowledge (STOCK) Act. The Act, which President Obama signed into law in 2012, followed the public outcry resulting from a “60 Minutes” report on lucrative trades by members of Congress during the debate over the Affordable Care Act and prior to the 2008 financial crisis. … More
Editors’ Note: This is the fourth in our start-of-year series examining important trends in white collar law and investigations in the coming year. Our previous entry discussed anti-corruption trends in 2020. Up next: a look at State Attorney General trends. Look for additional posts throughout the month of January.
More than halfway into the Donald Trump administration,… More
Editors’ Note: This is the second in our start-of-year series examining important trends in white collar law and investigations in the coming year. Our previous entry discussed SEC enforcement in 2020. Up next: a look at trends in anti-corruption and under the Foreign Corrupt Practices Act. Look for additional posts throughout the month of January.
2019 saw ongoing action in the healthcare space.… More
In December, the Department of Justice (DOJ) announced the release of a new policy for business organizations regarding voluntary self-disclosures of export control and sanctions violations. The new Policy makes explicit that when a company (1) voluntarily self-discloses export control or sanctions violations to the Counterintelligence and Export Control Section (CES) of DOJ’s National Security Division (NSD), (2) fully cooperates, and (3) timely and appropriately remediates its conduct, there is now a presumption that,… More