The United States Justice Department has initiated charges against 47 individuals linked to a Sh30 billion fraud, with federal prosecutors terming it the largest case of Covid-19 pandemic fraud in the U.S.
The 47 are accused of obtaining, misappropriating, and laundering millions of dollars in program funds that were intended as reimbursements for the cost of serving meals to children.
According to the US Justice Department, the defendants exploited changes in the program intended to ensure underserved children received adequate nutrition during the COVID-19 pandemic, but instead of feeding the children, the accused enriched themselves by fraudulently misappropriating millions of dollars in Federal Child Nutrition Program funds.
The heinous fraud involved anti-hunger programs in Minnesota State, America, during the coronavirus pandemic between 2020 and 2021 where the suspects were billing the state for meals that were never served- through the Federal Child Nutrition Program funds.
Proceeds of the fraud were used to acquire luxury vehicles, jewelry, beach plots and purchase of real estate property in Kenya, Turkey and the United States, and to fund international travels.
“This was a brazen scheme of staggering proportions. These defendants exploited a program designed to provide nutritious food to needy children during the COVID-19 pandemic. Instead, they prioritized their own greed, stealing more than a quarter of a billion dollars in federal funds to purchase luxury cars, houses, jewelry, and coastal resort property abroad.” said U.S. Attorney Andrew M. Luger.
“Today’s indictments describe an egregious plot to steal public funds meant to care for children in need in what amounts to the largest pandemic relief fraud scheme yet,” said FBI Director Christopher Wray.
According to a statement by the US Justice Department, the 47 defendants were charged across six separate indictments and three criminal informations with charges of conspiracy, wire fraud, money laundering, and bribery.
“To carry out the scheme, the defendants also created and submitted false documentation. They submitted fraudulent meal count sheets purporting to document the number of children and meals served at each site. The defendants submitted false invoices purporting to document the purchase of food to be served to children at the sites,” the statement read in part.
The youngest among the 47 inductees is Hamdi Hussein Omar, 26, of St. Paul, Minnesota, who was charged with conspiracy to commit wire fraud, and conspiracy to commit money laundering. Omar ran the Stigma-Free Waite Park site. This site claimed to have served more than 500,000 meals and received more than $1 million in fraudulent Federal Child Nutrition Program funds.
The investigations were successfully concluded through various multi-agencies including the Federal Bureau of Investigations (FBI), Internal Revenue Service, Criminal Investigation, and the U.S Postal Inspection Service.
“Exploiting a government program intended to feed children at the time of a national crisis is the epitome of greed. As alleged, the defendants charged in this case chose to enrich themselves at the expense of children. Instead of feeding the future, they chose to steal from the future.” said Special Agent Justin Campbell.
Assistant U.S. Attorneys Joseph H. Thompson, Harry M. Jacobs, Chelsea A. Walcker, Matthew S. Ebert, and Joseph S. Teirab for the District of Minnesota are prosecuting the case while assistant U.S. Attorney Craig Baune is handling the seizure and forfeiture of assets.
The Federal Child Nutrition Program, administered by the U.S. Department of Agriculture (USDA), is a federally-funded program designed to provide free meals to children in need. The USDA’s Food and Nutrition Service administers the program throughout the nation by distributing federal funds to state governments.