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(The Center Square) – Fraud in three North Carolina cases costing taxpayers about $27 million are among 17 getting enforcement action from the National Fraud Enforcement Division, the U.S. Justice Department said Friday.
One involved stealing food assistance from families, another was money laundering in disaster loans and unemployment benefits, and a third involved fraudulent tax refunds on COVID-19 tax credits. All are tied to the seven-state coalition – the newly created Southeast Fraud Enforcement Federal-State Partnership – collaborating efforts with 18 offices of federal prosecutors, five federal law enforcement partners and more than 50 state officials.
South Carolina, Georgia, Florida, Alabama, Mississippi and Louisiana are the others in the Deep South. The Justice Department said $350 million in losses were in the cases involving SNAP benefits, Small Business Administration loans, housing benefits and tax fraud.
“Defeating the fraud epidemic in our country requires all-hands-on-deck from our federal and state partners nationwide,” Assistant Attorney General Colin McDonald of the National Fraud Enforcement Division said in a release. “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.”
In U.S. District Court for the Eastern District of North Carolina, a woman in Robeson County and seven coconspirators caused nearly $25 million in losses, prosecutors say. The woman owned a tax return preparation business and has pleaded guilty to conspiring to prepare false returns with claims of fraudulent refunds based on COVID-19 tax credits. The case is known as United States v. Mitchell et al.
In U.S. District Court for the Middle District of North Carolina, prosecutors say a money laundering ring took proceeds from various fraud schemes. Included were false applications for Economic Injury Disaster Loans, and false applications for unemployment benefits. The losses were nearly $1.7 million in the case known as United States v. Adedayo Afolabi Fateru.
Two brothers from Romania have pleaded guilty in U.S. District Court for the Western District of North Carolina. The charges are wire fraud, whereby prosecutors say they orchestrated a scheme involving SNAP benefits to victims across multiple states resulting in nearly $766,000 in losses.
SNAP is the acronym for the Supplemental Nutrition Assistance Program of the U.S. Department of Agriculture. The state Department of Health and Human Services supervises local Department of Social Services offices in executing the program for more than 622,000 households from Murphy to Manteo.
For context, one victim said the family was on a monthly grocery run for roughly $700 of SNAP-eligible items. The defendants in United States v. Dumitru had used her benefits, the transaction was denied, and the food and school supplies could not be purchased.
The three federal prosecuting offices are led by Ellis Boyle in the Eastern District, Dan Bishop in the Middle District and Russ Ferguson in the Western District.
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