The United States Department of Justice has charged 47 people in a COVID-19 scam after they allegedly stole $250 million that was budgeted for children's meals.
The department announced the charges on Tuesday where they said that it is the largest COVID-19-related fraud uncovered by investigators to date. The suspects are facing a range of charges, including conspiracy, wire fraud, money laundering, and paying and receiving illegal kickbacks.
COVID-19-Related Fraud
Prosecutors said the defendants set up a network of shell companies connected to the Minnesota-based nonprofit 'Feeding Our Future'. The suspects are believed to have worked to exploit the federal child nutrition program, which was designed to provide meals to children from low-income families.
Furthermore, Congress expanded the program at the beginning of the coronavirus pandemic to allow more organizations to participate. In a release, the Justice Department said, "Feeding Our Future employees recruited individuals and entities to open Federal Child Nutrition Program sites throughout the state of Minnesota."
The department added that these sites, which were created and operated by the defendants and others, fraudulently claimed to be serving meals to thousands of children per day within just days or weeks of being formed, as per CNN.
Authorities claim that despite Feeding Our Future's knowledge of their own fraudulent claims, they continued to submit them to the Minnesota Department of Education, which administered and oversaw the federal program for the state.
US Attorney Andrew M. Luger for the District of Minnesota said that the crime was a "brazen scheme of staggering proportions." He added that the defendants exploited a program that was designed to provide nutritious food to needy children during the health crisis.
According to NBC News, Luger added that the suspects worked extremely fast in stealing money at a preposterous rate. The defendants were able to claim more than 125 million fake meals during the course of the fraud, Luger said.
Stealing $250 Million
Officials said many of the defendants are charged not only with fraud but with bribery because the government said the charities took kickbacks from the food sites in exchange for steering them federal grants. Many of them were also charged with money laundering for allegedly moving stolen funds through shell corporations and other vehicles to blur the trail.
Prosecutors added that the fraud was overseen primarily by Aimee Bock, who ran Feed Our Future. However, Bock has denied any wrongdoing and argued that if fraud occurred, it happened without her knowing about it.
Nonprofits such as Feeding Our Future were supposed to sponsor and oversee the restaurants, community centers, and other places where the meals were to be provided. The crime occurred as some standard program requirements were relaxed during the COVID-19 pandemic.
Luger argued that the small group of defendants came up with a plan to exploit the relaxed rules and steal tens of millions of dollars. He added that other people soon joined the fraud, helping it grow to become one of the largest pandemic-related frauds in the United States, CBS News reported.
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