The DOJ's National Fraud Enforcement Division announced roughly $350 million in alleged fraud spanning seven states on Thursday, the latest and largest action yet from the Trump administration's anti-fraud push.
Seventeen separate cases, stretching from Mississippi to North Carolina, target schemes that allegedly looted federal programs meant to help low-income Americans, small businesses, and Medicare patients. The announcement, made alongside state partners in Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina, and South Carolina, came after a roundtable that brought together 18 U.S. Attorneys Offices, seven State Attorneys General, five federal law enforcement agencies, and more than 50 state officials.
Assistant Attorney General Colin M. McDonald, who leads the fraud enforcement division, framed the crackdown as a direct result of federal-state cooperation. The division also announced new data-sharing agreements with all seven states, giving federal investigators access to publicly available corporate registration records and public benefits payment data held by state agencies.
The Daily Caller reported the details ahead of the official announcement, based on information shared directly by officials. The cases involve alleged fraud against SNAP benefits, Small Business Administration loans, housing subsidies, Medicare, and the tax system, a cross-section of the federal safety net that taxpayers fund and millions of Americans depend on.
Among the most striking cases is the one out of Mississippi. Lakeith Faulkner, described as both an attorney and an employee of the Small Business Administration, stands accused of devising a kickback scheme with co-conspirators, including a former IRS employee, to generate millions in fraudulent SBA loan payments. The alleged take: $11.5 million.
That a government employee allegedly used his position inside the SBA to loot the very agency that employed him captures the kind of insider corruption the fraud division was built to root out. The involvement of a former IRS worker only deepens the picture of alleged institutional betrayal.
In Louisiana, two individuals face charges for allegedly submitting $174 million in fraudulent Medicare claims. The claims were for medically unnecessary cancer genetic testing and cardiovascular genetic testing, services that, if the charges hold, were billed to taxpayers for patients who did not need them. That single case accounts for roughly half the total dollar figure announced Thursday.
Eight individuals in North Carolina allegedly conspired to prepare false tax returns claiming fraudulent refunds based on COVID-19 tax credits. The losses: nearly $25 million. The pandemic-era credits, designed to keep businesses and workers afloat during shutdowns, became a magnet for fraud nationwide. This case suggests the cleanup is far from over.
In Florida, a former manager of the Tallahassee Housing Authority allegedly used tenants' personal information, Social Security numbers and other identifying data, to fraudulently obtain half a million dollars in rent subsidies from the Department of Housing and Urban Development. The people whose identities were allegedly stolen were the very tenants the housing authority was supposed to serve.
A separate case, with no state specified, involves one individual accused of $70 million in tax fraud. The DOJ provided no further details on that defendant.
Thursday's announcement did not arrive in a vacuum. The White House launched its Anti-Fraud Task Force in the spring, placing Vice President J.D. Vance at the helm. In May, Vance traveled to Maine for his first public event focused on fraud enforcement.
At that Maine event, Vance made the case in plain terms, as reported by the Daily Caller:
"But here's the thing, my friends, because you all work hard, because you all pay your taxes, because you do things the right way, it is time to have leadership in Washington that treats you the right way and protects those hard earned tax dollars."
The administration's focus on fraud was largely inspired by a specific case that broke not in a federal courtroom but on YouTube. Nick Shirley, a content creator, exposed nearly a dozen Somali-run daycare centers in Minnesota that were allegedly not providing services despite collecting government payments. That reporting helped push the issue from social media into the policy arena.
McDonald, the assistant attorney general, emphasized that the federal-state partnership model is central to the division's strategy. In a statement provided to the Daily Caller, he laid out the logic:
"Whether it's sharing intelligence, data, personnel, or priorities, partnering with state agencies directly strengthens our ability to identify those stealing taxpayer dollars. When federal prosecutors work alongside state agencies to root out fraud, fraudsters lose and the American people win."
Beyond the cases themselves, Thursday's announcement included a structural change. All seven southeastern states signed data-sharing agreements with the fraud enforcement division, granting federal investigators access to publicly available corporate registration and public benefits payment data held by state agencies. The agreements represent a shift toward real-time cooperation rather than the siloed approach that has historically let fraud slip between jurisdictions.
The scope of the roundtable underscores the scale of the effort. Eighteen U.S. Attorneys Offices, seven State Attorneys General, five federal law enforcement partners, and more than 50 state officials participated. That kind of coordination across agencies and state lines is unusual and suggests the administration views fraud enforcement not as a one-off but as a sustained campaign.
Some questions remain open. The individual case amounts detailed in the announcement, $174 million, $70 million, $25 million, $11.5 million, and $500,000, add up to roughly $281 million, leaving a gap against the stated $350 million total. The remaining cases, and the specific roles of Alabama, Georgia, and South Carolina, were not described in the information provided to the Daily Caller. No arrests or convictions were confirmed; the cases appear to be at the charging or indictment stage.
McDonald also stated the broader principle driving the division's work:
"Defeating the fraud epidemic in our country requires all-hands-on-deck from our federal and state partners nationwide."
For years, waste and fraud in federal programs have been treated as background noise, a cost of doing business that Washington shrugs at while taxpayers foot the bill. If $350 million in one regional sweep is what serious enforcement turns up, the real question is how much more is still out there waiting to be found.
