The Justice Department’s National Fraud Enforcement Division has reportedly uncovered approximately $350 million in alleged fraud across the Southeastern United States, with cases spanning seven states and involving a wide range of programs funded by taxpayer dollars.
The charges are spread across 17 separate cases in Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina and South Carolina. The investigations involve alleged fraud connected to the Supplemental Nutrition Assistance Program (SNAP), Small Business Administration (SBA) loans, housing benefits and tax filings.
The Justice Department is expected to formally announce the cases alongside its state partners, whose cooperation officials say played a key role in uncovering the alleged schemes.
As part of the initiative, the seven participating states have agreed to enter data-sharing partnerships with the National Fraud Enforcement Division. The agreements will provide the Justice Department with access to publicly available corporate registration records and public benefits payment data maintained by state agencies.
Officials believe the expanded access will improve the department’s ability to identify fraud patterns that stretch across businesses and jurisdictions.
“Defeating the fraud epidemic in our country requires all-hands-on-deck from our federal and state partners nationwide,” Assistant Attorney General Colin M. McDonald of the National Fraud Enforcement Division said in a statement.
“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,” McDonald added.
Among the cases announced is an alleged fraud scheme in Mississippi totaling $11.5 million.Mississippi authorities accuse attorney Lakeith Faulkner, who was also employed by the Small Business Administration, of orchestrating a kickback scheme with several co-conspirators, including a former Internal Revenue Service employee. Investigators allege the operation generated millions of dollars in fraudulent SBA loan payments.
Another major case comes from North Carolina, where eight individuals allegedly conspired to prepare false tax returns claiming fraudulent refunds tied to COVID-19 tax credits. Authorities say the scheme resulted in nearly $25 million in losses.
In Louisiana, investigators allege two individuals submitted $174 million in fraudulent Medicare claims for medically unnecessary cancer genetic testing and cardiovascular genetic testing.
Florida authorities also uncovered an alleged housing fraud scheme involving a former manager at the Tallahassee Housing Authority. The former manager used tenants’ personally identifiable information to fraudulently obtain approximately $500,000 in rent subsidies from the U.S. Department of Housing and Urban Development.
Another case announced Thursday involves an individual accused of carrying out approximately $70 million in tax fraud.
Ahead of the announcement, the Justice Department hosted a roundtable discussion with its southeastern partners to coordinate fraud enforcement efforts. The meeting brought together representatives from 18 U.S. Attorneys’ Offices, seven state attorneys general offices, five federal law enforcement agencies and more than 50 state officials.
Combating fraud has become a major priority for the Trump administration. Earlier this spring, the White House launched an Anti-Fraud Task Force led by Vice President J.D. Vance. The Department of Justice also appointed McDonald as an assistant attorney general with a focus on rooting out fraud nationwide.
According to the article, the administration’s focus has been largely inspired by YouTuber Nick Shirley, whose reporting exposed nearly a dozen Somali-run daycare centers in Minnesota that were allegedly not providing the services they claimed.
The administration has continued working with states to identify fraud and safeguard taxpayer dollars. In May, Vance traveled to Maine for his first fraud-focused event, where he emphasized the importance of protecting public funds.
“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,” Vance told attendees.
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