DOJ’s National Fraud Enforcement Division Announces Over $340 Million in Fraud Actions in One Week

DOJ’s National Fraud Enforcement Division Announces Over $340 Million in Fraud Actions in One Week

The US Department of Justice’s (DOJ) newly created National Fraud Enforcement Division announced a sweeping series of enforcement actions representing over $340 million in taxpayer fraud in a single week. The DOJ’s press release touted more than 20 enforcement actions, including five individuals who were arrested in Kentucky, Indiana, and Colorado for an alleged $1.6 million COVID-19 relief fraud scheme; a former teacher who pleaded guilty in San Diego to conspiring to launder millions in health care fraud proceeds and paying $3.7 million in unlawful kickbacks; a federal grand jury in Maryland that indicted a former Social Security Administration employee in an alleged disability theft scheme; a Missouri chiropractor who was sentenced to more than eight years and ordered to repay $4.7 million for health care fraud involving the issuance of nearly 95,000 oxycodone pills with no legitimate medical purpose; a Minneapolis man who was sentenced to 43 months for his role in the $250 million Feeding Our Future child nutrition fraud scheme; and an Iowa farmer who was sentenced to over 10 years for cheating federal taxpayers out of more than $1.7 million. 

Read the DOJ’s press release here.

DOJ Announces $300 Million Special Attorneys Grant Program to Prosecute Fraud, Drug Trafficking, and Other Crimes

On April 22, the DOJ announced the availability of $300 million in funding to support a new Special Attorneys Program. According to the DOJ, this new grant program is intended to “strengthen investigative and prosecutorial capacity, expand intergovernmental coordination, and enhance the ability of jurisdictions to investigate and prosecute fraud and other crimes committed by criminal aliens within the United States and drug and human trafficking crimes.” The program will provide funding to state, local, Tribal, and territorial prosecuting agencies to assign or hire qualified prosecutors who will serve as Special Attorneys within the DOJ’s National Fraud Enforcement Division or Criminal Division, or as Special Assistant United States Attorneys within US Attorney’s Offices. Funding awards will be issued on a rolling basis, beginning on June 1. 

Read the DOJ’s press release here.

Former Pharmacy President Sentenced for Health Care Fraud and Kickback Scheme

Adam Brosius, 61, of Delray Beach, Florida, was sentenced to 24 months in prison for his role in a $33 million health care fraud and kickback scheme involving compounded medications. Brosius served as director of business development and later president of Main Avenue Pharmacy, a mail-order pharmacy with a storefront in Clifton, New Jersey. From 2014 through 2016, Brosius and others used Main Avenue to run an illegal kickback scheme involving medically unnecessary compounded drugs, including scar creams, pain creams, migraine medication, and vitamins. The scheme involved identifying compounded drugs that would yield high reimbursements from health insurers, creating large prescription pads with those formulas, and distributing them to marketers across the country who, in turn, funneled them to telemedicine companies and financially affiliated doctors. Main Avenue submitted claims for reimbursement to Medicare, TRICARE, and commercial payers, and paid kickbacks to the marketers who generated the prescriptions. Main Avenue received approximately $33 million in reimbursements, with over $5.8 million paid by TRICARE. In addition to the prison term, the court ordered $33 million in restitution, $27 million in forfeiture, and a term of supervised release. 

Read the DOJ’s press release here.

Former Teacher Pleads Guilty in $51 Million Medicare Fraud Scheme

Former teacher Jeanett Valenzuela Ayub pleaded guilty in federal court in San Diego to conspiring to launder at least $14 million in Medicare fraud proceeds. Valenzuela and co-conspirators owned and operated multiple durable medical equipment (DME) companies that sold orthotics, including back, wrist, and knee braces, to Medicare beneficiaries. The scheme involved paying unlawful kickbacks to sham marketing companies that provided bogus prescriptions signed by physicians who had no legitimate doctor-patient relationship with the beneficiaries and had not conducted legitimate medical evaluations. In total, the conspirators billed Medicare nearly $51 million and were paid approximately $20 million. When agents interviewed Medicare beneficiaries, they confirmed they never spoke with, or were examined by, a prescribing doctor, and many had never even opened the packages containing the DME. When co-conspirators’ DME companies were suspended from billing Medicare, Valenzuela used nominee owners to maintain control of the companies while concealing her involvement. When her brother — co-conspirator Fernando Valenzuela Ayub — was arrested in December 2024, Valenzuela absconded to Tijuana and was ultimately detained in the Dominican Republic in August 2025. Valenzuela is scheduled to be sentenced on July 24. The case is being prosecuted as part of the DOJ’s National Fraud Enforcement Division. 

Read the DOJ’s press release here.

Tacoma Grocery Store Owner Indicted for Food Stamp Fraud Scheme

Manjit Bedi, 64, owner of a small Tacoma, Washington, grocery store, was arraigned in US District Court in Tacoma on multiple counts of wire fraud and Supplemental Nutrition Assistance Program (SNAP) benefit fraud. According to the indictment, Bedi’s store was authorized to accept SNAP benefits in February 2024. Beginning in March 2024, Bedi allegedly agreed to provide SNAP recipients with cash in exchange for the funds loaded on their electronic benefits cards (EBT). For example, Bedi would charge $200 against a recipient’s EBT card, provide $100 in cash to the recipient, and pocket the remaining $100 as profit. The indictment alleges Bedi pocketed at least $600,000 in SNAP benefits for food items that were never sold. Both wire fraud and SNAP benefit fraud carry penalties of up to 20 years in prison and a $250,000 fine. 

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Read the DOJ’s press release here.