DOJ charges nonprofit with $250 million pandemic fraud scheme

The Justice Department announced Tuesday that 47 people are being charged with stealing $250 million from a federal program meant to provide food for children in need during the pandemic, CNN reports. 

The DOJ is calling this the largest COVID-19 related fraud scheme that investigators have discovered. CNN reports that the suspects are facing conspiracy charges, wire fraud, money laundering, and paying/receiving illegal kickbacks.

Prosecutors said that the defendants created a network of shell companies associated with the Minnesota-based nonprofit organization Feeding Our Future to steal funds from the program designed to provide low-income families with food for their children. The program had been expanded to meet the community's needs during the pandemic, which opened the doors for more organizations to participate. 

"Feeding Our Future employees recruited individuals and entities to open Federal Child Nutrition Program sites throughout the state of Minnesota," the DOJ said in a news release. "These sites, created and operated by the defendants and others, fraudulently claimed to be serving meals to thousands of children a day within just days or weeks of being formed."

Feeding Our Future submitted its claims to the Minnesota Department of Education, despite being aware that their submission was fraudulent. US Attorney Andrew M. Luger for the District of Minnesota called their actions "a brazen scheme of staggering proportions." He alleged that the defendants stole "more than a quarter of a billion dollars in federal funds to purchase luxury cars, houses, jewelry, and coastal resort property abroad," per CNN.