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Government Program Fraud Defense

Government program fraud cases are built from program data before anyone is interviewed. By the time an Inspector General agent calls, the agency has usually matched claims, redemptions, or payments against other records for months. The defense has to start where the government started: the program rules, the paperwork, and what you actually knew.

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  • Aaron M. Cohen, more than 30 years of federal criminal defense. Government program fraud investigations and prosecutions nationwide.
  • Pandemic unemployment insurance fraud, S.D. Fla., August 2026: sentence 22 months below the bottom of the guideline range on the conspiracy count (U.S. v. W.W.)

Prior results do not guarantee a similar outcome. Every case is different and depends on its own facts.

Federal agents entering a government office, illustrating a government program fraud investigation

Government Program Fraud Enforcement in 2026

Federal program fraud is one of the largest categories of white-collar prosecution in the country. In TRAC's 2026 bulletins, prosecutors classified roughly one in six white-collar cases as federal program fraud, ahead of bank fraud and healthcare fraud. Theft of public money under 18 U.S.C. § 641 averaged about 16 defendants a month as a lead charge, and conspiracy to defraud the United States under 18 U.S.C. § 371 about 12.

DOJ has also reorganized around this work. On August 13, 2026, the head of the new National Fraud Enforcement Division, Assistant Attorney General Colin McDonald, set five enforcement priorities. The first is procurement fraud and government program fraud: student loans, childcare subsidies, veterans' benefits, nutrition programs, disaster relief, and small business programs. The third is promoters of COVID-era credit schemes such as the Employee Retention Credit.

How These Investigations Start

Each benefit program has an Office of Inspector General with its own criminal agents:

  • USDA-OIG: SNAP and EBT, including retailer trafficking
  • DOL-OIG: unemployment insurance
  • SBA-OIG: SBA loans and small business programs
  • ED-OIG: federal student aid
  • VA-OIG: veterans' benefits
  • DHS-OIG: FEMA and disaster relief

Cases usually begin with one of these:

  • Data matching. Agencies compare claims, redemptions, payroll, and identity data across systems and flag outliers.
  • Program audits and overpayment notices. An administrative review, payment hold, or demand letter can feed a criminal referral.
  • Undercover activity. SNAP retailer cases often rest on undercover purchases by agents or informants.
  • Whistleblowers and cooperators. Employees, business partners, and co-defendants who were approached first.
  • Subpoenas and search warrants. OIG subpoenas, grand jury subpoenas, and warrants for business records and phones.
  • Agents at the door. An unannounced interview at your home or business, often on the same day as other interviews.

The Charges and What the Government Must Prove

  • Theft of public money, 18 U.S.C. § 641. The government must prove the money belonged to the United States and that you knowingly took or converted it. Up to 10 years per count when the total exceeds $1,000; up to one year at or below $1,000.
  • Conspiracy to defraud the United States, 18 U.S.C. § 371. An agreement to defraud a federal agency and one overt act. Up to 5 years.
  • False statements, 18 U.S.C. § 1001. A knowing, material false statement in a matter within federal jurisdiction, including to an agent in an interview. Up to 5 years.
  • False claims, 18 U.S.C. § 287. Presenting a claim to a federal agency knowing it is false. Up to 5 years. Conspiracy involving false claims, 18 U.S.C. § 286, carries up to 10 years.
  • Wire fraud, 18 U.S.C. § 1343, and conspiracy, § 1349. Paired with almost every program fraud charge because applications and payments travel by wire. Up to 20 years per count, and up to 30 years when the fraud involves benefits paid in connection with a presidentially declared major disaster or emergency.
  • Aggravated identity theft, 18 U.S.C. § 1028A. A mandatory two years, consecutive, when another person's identity was used.

Program-specific charges

  • SNAP and EBT, 7 U.S.C. § 2024. Unauthorized use, transfer, or acquisition of benefits carries up to 20 years when the benefits are worth $5,000 or more. Presenting unlawfully obtained benefits for redemption carries up to 5 years.
  • Disaster relief and FEMA, 18 U.S.C. § 1040. Fraud in connection with major disaster or emergency benefits. Up to 30 years.
  • Federal student aid, 20 U.S.C. § 1097. Obtaining student aid funds by fraud or false statement. Up to 5 years.
  • Child care subsidy, unemployment insurance, and VA benefits are usually charged under § 641, § 1001, wire fraud, and conspiracy.
  • SBA loans, including PPP and EIDL, are covered on our PPP and EIDL fraud defense page.

ERC and COVID-Era Credit Investigations

The Employee Retention Credit paid employers for keeping workers on payroll during the pandemic. Eligibility turned on rules that were complex and changed more than once, and a promoter industry grew up around it: firms that marketed the credit, prepared the claims, and took a percentage of the refund.

NFED's third priority targets those promoters. These cases are usually charged as conspiracy to defraud the United States (§ 371), conspiracy involving false claims (§ 286), false claims (§ 287), and wire fraud. The government's evidence typically includes marketing materials, eligibility questionnaires, fee agreements, communications with clients, and the volume and pattern of claims a firm filed. IRS Criminal Investigation usually leads the agent work.

Promoter cases put three groups at risk:

  • Promoters and firm owners, who face conspiracy and false claims charges based on how the firm marketed and computed claims.
  • Preparers and staff, who may be charged or pressed to cooperate depending on what they knew about the eligibility basis.
  • Business owners who filed, who are often witnesses but can become subjects if the government believes they knew the claim was false.

The defense turns on what each person knew. Eligibility rules that changed during the program, written advice relied on in good faith, and a promoter who controlled the calculations are real defenses. Your position in the case can shift quickly, so do not discuss the claim with agents, the promoter, or other clients before you have counsel.

Penalties and How Sentencing Works

Statutory maximums rarely decide the sentence. The fraud guideline, U.S.S.G. § 2B1.1, builds the offense level mainly from loss, the greater of actual or intended loss. Enhancements can apply for the number of victims, sophisticated means, use of another person's identity, and offenses involving disaster benefits. Restitution of the full loss is mandatory, and forfeiture follows the money.

Loss is the most contested number in these cases. In a conspiracy, the government often attributes the entire scheme to each defendant. The law limits relevant conduct to the scope of what a defendant agreed to join, and that argument can change the guideline range by years.

The Parallel Civil and Administrative Track

Criminal charges are rarely the only exposure. The False Claims Act, 31 U.S.C. § 3729, allows treble damages and per-claim penalties, and whistleblower suits are filed under seal while DOJ investigates. Agencies can suspend or debar you and your business from federal programs, permanently disqualify a store from SNAP, and demand repayment of overpayments. What you say in an administrative response can be used in the criminal case. Both tracks have to be handled together.

How These Cases Are Defended

  • Intent. Most of these statutes require proof that you acted knowingly. Confusing rules, guidance that changed mid-program, and reliance on preparers, caseworkers, or advisers are defenses.
  • The data. Government flags are statistical. The full records often explain what an analyst's spreadsheet does not.
  • Scope. In multi-defendant cases, we separate what you did from what others did.
  • Loss. We test the government's loss figure claim by claim.
  • Timing. The strongest work happens before indictment, while the prosecutor is still deciding whom to charge and for what.

What to Do Now

  1. Do not talk to agents. You can decline an interview. A false statement to an agent is a separate felony under § 1001, even when the underlying conduct is defensible.
  2. Preserve everything. Do not delete, alter, or backdate records. Destroying records creates new charges.
  3. Do not contact co-workers, promoters, or clients about the investigation. Those conversations can be recorded or repeated.
  4. Call counsel before you respond to any letter, subpoena, or overpayment demand.

Who Handles Your Case

Aaron M. Cohen has defended federal fraud cases for more than 30 years. Our team includes a federal investigations consultant who is a former FBI Supervisory Special Agent and a Certified Public Accountant licensed in Ohio and Florida, and a sentencing strategist who works on mitigation and loss analysis from the start of the case.

Related Results

United States District Court, Southern District of Florida · August 2026
United States v. W.W.
Conspiracy to Commit Access Device Fraud, 18 U.S.C. § 1029(b)(2), and Aggravated Identity Theft, 18 U.S.C. § 1028A(a)(1)
Result
48 Months Total | 24 Months on the Conspiracy Count, a 22-Month Downward Variance Below the Guideline Range | Self-Surrender Granted | Residential Drug Abuse Program and Family-Proximity Designation Recommended to the Bureau of Prisons. Half of the sentence, 24 months, was the consecutive term 18 U.S.C. § 1028A requires and no court has discretion to reduce. On the one count where the court had sentencing discretion, the client received 24 months against a range that started at 46.
View all case results

Frequently Asked Questions

Up to 10 years in prison per count when the total value across the counts of conviction exceeds $1,000. At $1,000 or less, the offense is a misdemeanor with a maximum of one year. In practice, the sentence is driven by the loss amount under the federal fraud guideline, U.S.S.G. § 2B1.1, not the statutory maximum. Restitution of the full loss is mandatory, and the government will seek forfeiture of money and property it ties to the offense. Many cases add wire fraud, conspiracy, or aggravated identity theft counts, which raise the exposure.

Each federal agency that runs a benefit program has an Office of Inspector General with sworn criminal investigators. USDA-OIG handles SNAP, DOL-OIG handles unemployment insurance, SBA-OIG handles SBA loans, ED-OIG handles student aid, VA-OIG handles veterans' benefits, and DHS-OIG handles FEMA disaster aid. An OIG agent asking questions usually means the agency has already reviewed your records and is working with a federal prosecutor. Be polite, take a card, decline the interview, and call a lawyer before you say anything.

Yes. Repayment does not erase a completed offense. Theft of public money and false claims are complete when the money is taken or the claim is made. Repayment can still matter: it can affect the charging decision, the loss calculation, and the sentence. How and when it happens matters too. A repayment made without counsel can be treated as an admission. Talk to a lawyer before you repay, sign an agreement, or respond to an overpayment notice in a case that may be criminal.

Two tracks usually run at once. USDA's Food and Nutrition Service can permanently disqualify the store from SNAP after a trafficking finding, often based on transaction data alone. On the criminal side, prosecutors charge 7 U.S.C. § 2024, which carries up to 20 years when the benefits are worth $5,000 or more, often with wire fraud and money laundering counts. Cases often begin with undercover purchases and data showing redemptions out of line with the store's size and inventory. The administrative response and the criminal defense have to be coordinated from the first day.

Possibly. Federal pandemic unemployment programs were funded with federal money, and DOL-OIG and state workforce agencies continue to refer cases. Charges range from theft of public money and false statements to wire fraud and, where another person's identity was used, aggravated identity theft. That last charge adds a mandatory two years in prison, consecutive to any other sentence. Exposure depends on the facts: a single overpayment dispute is very different from claims filed in other people's names. If you receive a letter, subpoena, or agent contact, get counsel before responding.

Yes. The National Fraud Enforcement Division's August 13, 2026 memo lists promoters of COVID-era credit schemes such as the Employee Retention Credit as an enforcement priority. Prosecutors have charged promoters and preparers with conspiracy to defraud the United States under 18 U.S.C. § 371, conspiracy involving false claims under 18 U.S.C. § 286, false claims under 18 U.S.C. § 287, and wire fraud. Business owners who relied on a promoter can become witnesses, subjects, or targets, depending on what they knew and what they signed.

No. These statutes require proof that you acted knowingly, and most require intent to defraud. Confusing eligibility rules, rules that changed while the program was running, bad advice from a preparer or caseworker, and honest errors on forms are defenses the government has to overcome. The government proves intent with circumstantial evidence: patterns across many claims, false documents, money moved quickly after it arrived, and what you said to investigators. That is why the first interview is so dangerous.

Yes. We represent individuals and business owners in federal program fraud investigations and prosecutions nationwide, appearing pro hac vice where required. Program fraud is investigated by national agencies, so a case can be filed in the district where the claims were processed, where the money was paid, or where you live. Multi-defendant schemes are often charged in one district even when the people involved live in several states. The early work, including responding to subpoenas, handling agent contact, and engaging the prosecutor before indictment, can usually begin by phone and video right away.

Justice Watch Analysis

Federal Fraud Enforcement · 9 min read

Federal SNAP Trafficking Charges in South Florida: What Store Owners Face Under 7 U.S.C. 2024

A grand jury charged four men over $19 million in SNAP benefits at three South Florida stores. The money laundering counts are what drive the sentence.

White Collar / COVID Fraud · 12 min read

The Trump Task Force to Eliminate Fraud Is Reopening COVID Files. What Contractors, Vendors, and PPP Borrowers Need to Know.

Took PPP, EIDL, or a COVID-era federal contract? GSA just flagged $1.22 billion in vendor fraud and DOJ charged 160 more. Learn why your file is not closed.

Federal Enforcement · 9 min read

DOJ Is Now Deputizing Local Prosecutors to Bring Federal Fraud Cases: What the National Fraud Enforcement Division's Special Attorneys Program Means for Florida Targets

DOJ's new $300 million Special Attorneys Program now lets local prosecutors bring federal healthcare fraud charges against you under 18 U.S.C. § 1347.

Federal Criminal Defense / Pre-Indictment Investigation · 11 min read

FBI Agents at Your Door in Florida: The §1001 Trap, the FD-302, and Why Pre-Indictment Silence Is Your Strongest Asset

Two FBI agents at your front door at 7 a.m. You are not under arrest. No Miranda warnings. And anything you say can fuel a § 1001 false-statements charge even if the underlying conduct is defensible. Aaron Cohen explains the doorstep trap, the FD-302, and the proffer pitfalls Florida federal targets keep walking into.

Federal Health Care Fraud · 11 min read

A $14 Million VA Kickback Case Just Ended in Guilty Pleas in Orlando: What Veterans' Health Care Providers Need to Know

Two Orlando men pleaded guilty in a $14 million VA kickback case that began with one hotline call. What Florida providers with VA referrals must do now.

White Collar & Fraud · 9 min read

SBA Just Sent 562,000 PPP and EIDL Loans to Treasury for Collection. Here Is What That Means for Florida Borrowers.

Got a Treasury letter over a PPP or EIDL loan? SBA just referred 562,000 loans for collection and sent the same borrowers to DOJ. Learn what happens next.

Read all Justice Watch articles

Related Practice Areas

Federal Criminal Defense

PPP / EIDL Fraud

PPP and EIDL prosecutions are still moving, and the statute of limitations is ten years. SBA OIG subpoenas, grand jury target letters, and indictments are landing five years after the loans closed. If you received a PPP or EIDL loan and now have a federal investigator at your door, the case is already built.

Federal Criminal Defense

Wire Fraud

Wire fraud under 18 U.S.C. § 1343 is one of the most frequently charged federal crimes, and one of the most flexible tools in a federal prosecutor's toolkit. Any scheme to defraud that uses a wire communication crosses into federal jurisdiction. The penalty is up to 20 years per count.

Federal Criminal Defense

Bank Fraud

Bank fraud under 18 U.S.C. § 1344 carries up to 30 years and a $1,000,000 fine per count, and the government has ten years to charge it. Most cases start inside the bank, with a fraud department review or a Suspicious Activity Report, long before an agent calls. The defense starts with the loan file and the account records the government already has.

Federal Criminal Defense

Identity Theft

Federal aggravated identity theft under 18 U.S.C. § 1028A carries a mandatory two-year consecutive sentence that stacks on top of the underlying offense, with no judicial discretion to run it concurrently. When paired with wire fraud or healthcare fraud, a single case can produce 15 to 20 years in mandatory federal time.

Federal Criminal Defense

Target Letter Defense

A target letter from a United States Attorney's Office means the government has already decided you are someone it wants to prosecute. The investigation is not beginning. It is ending.

Federal Criminal Defense

FBI Investigations and Grand Jury Subpoenas

If federal agents came to your home or office, you were served with a grand jury subpoena, or a letter arrived from a U.S. Attorney's Office, you are part of a federal investigation. You have the right to decline an interview and to have a lawyer respond for you. Use both rights. What you say in the first conversation with an agent is often the most important evidence in the case.

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This page is attorney advertising and general information, not legal advice. Contacting AMC Defense Law does not create an attorney-client relationship. Prior results do not guarantee a similar outcome. Aaron M. Cohen, Esq., is responsible for the content of this page. AMC Defense Law, 1200 N. Federal Highway, Suite 300, Boca Raton, Florida 33432.