Explainer: How the alleged conspiracy exploited the pandemic to net $250 million | Health, medicine and fitness

By Amy Forletti – The Associated Press

Minneapolis (AFP) – The Department of Justice has 47 people charged in Minnesota In what prosecutors described as a $250 million plan to defraud a federal meal program.

Prosecutors said only a fraction of the money went to feed the children, while the rest was laundered through shell companies and spent on property, luxury cars and travel.

Here’s a look at how the alleged scheme worked, according to court documents:

The roots of the alleged scheme

The defendants are accused of targeting federal child nutrition programs that provide free meals to low-income children and adults. The money comes from the US Department of Agriculture, with oversight from state governments. In Minnesota, funds are administered by the state Department of Education, with meals historically provided to children through schools and daycare centers. Sites serving food are sponsored by licensed public or non-profit groups.

People also read…

Some standard software requirements have been relaxed during the COVID-19 pandemic; For-profit restaurants were allowed to participate, and food could be distributed outside of educational programs.

Minnesota Attorney General Andy Luger said Tuesday that a small group of people came up with a plan to exploit the relaxed rules and steal tens of millions of dollars by falsely claiming that they are feeding children.

Soon others joined in, and the plan grew into what Luger called the largest pandemic fraud in the United States

Several companies offer meals to low-income children, and many are using Feeding Our Future as a sponsor for funding, according to court documents.

Authorities allege Feeding our Future recruited other employees to open program sites across Minnesota that inflated the number of children and meals they were serving, or none at all. The nonprofit then made false claims for compensation, and received a 10% to 15% management fee plus commissions from people who wanted to join the scheme, the charges allege.

The accusations say the scheme used fake companies that falsified invoices showing that meals were served and provided fake attendance lists claiming to list the names and ages of the children fed each day.

The FBI says one company claimed to be serving meals to 300 children per day in January 2021. By February 2021, the group claimed it was serving meals per day to 3,290 children. In all, the group received $3.6 million in damages in 2021, according to FBI testimony. Almost all of this was deposited into his bank account, and then most of it went to another company. Little was used to buy food.

Feeding Our Future was formed in 2016 to help poor and minority communities secure funding for the Federal Food Program. The nonprofit quickly became the largest independent sponsor of such programs in Minnesota.

Founder Amy Book told the Star Tribune this year that it employed 65 employees who spoke 17 languages, and was working with 140 subcontractors to distribute 100,000 meals a day to Minnesota children.

An affidavit from the FBI tracked the increasing payments to the nonprofit: $307,000 in 2018, $3.45 million in 2019, $42.7 million in 2020, and $197.9 million in 2021.

Bock said she never stole the money and saw no evidence of fraud among its subcontractors. Feeding Our Future was resolved in February.

Court documents indicate that the Department of Education has become concerned about the rapid growth in payments and the number of sites sponsored by Feeding Our Future. The department said it reached out to the USDA in the summer of 2020 and began examining applications for nonprofit sites. In one case, the agency rejected an application for a group that claimed in March 2021 that it was providing an after-school snack and dinner for 5,000 children per day; The FBI described this as “too many kids.”

The Department of Education went to the FBI in April 2021, and the FBI began investigating the following month. Last January, officers raided several properties including the offices of Feeding Our Future and Bock’s home.

The FBI said Feeding Our Future earned $244 million in federal compensation through nutritional programs between 2018 and 2021. Department of Education data puts total reimbursements to nonprofits at $268.4 million in the same years.

Shipping documents announced Tuesday say Feeding our Future fraudulently obtained more than $240 million in program funds during the pandemic.

Prosecutors say the money almost never went to feed the children, but was instead used to buy real estate, cars and other luxury items including a half-million-dollar apartment in Kenya, lakeside homes in Minnesota, expensive cruises and several properties in Minneapolis. .

After the Department of Education increased its scrutiny, Feeding Our Future filed a lawsuit against the agency in November 2020. Feeding Our Future alleges discrimination, among other things, saying that many of the groups it works with belong to minority communities.

By December 2020, the Department of Education had stopped approving applications for new locations to fuel our future. By the following March, management halted all payments to the group. But in April 2021, a state judge ruled that the agency did not have the authority to stop the payments and ordered the payments to continue. The case was dismissed after the FBI investigation became public in January.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.

Leave a Comment