DISPLAYED. Aimee Bock, the executive director of the nonprofit organization Feeding Our Future, speaks on Thursday, January 27, 2022 in St. Anthony, Minnesota On February 20, 2022, what they said was a massive plan to end the Covid-19 pandemic exploited to steal $250 million from a federal program that provides meals to low-income children. /AP
MINNEAPOLIS — U.S. authorities indicted 48 people in Minnesota on conspiracy and other charges on Tuesday in what they say was the largest pandemic-related fraud scheme to date, stealing $250 million from a federal program targeting children of low Income provides meals.
Federal prosecutors say the defendants set up businesses that claimed to provide food to tens of thousands of children across Minnesota and then sought reimbursement for those meals through the US Department of Agriculture’s food nutrition programs.
Prosecutors say few meals were actually served, and the defendants used the money to buy luxury cars, real estate and jewelry.
“That $250 million is the bottom,” Andy Luger, the US Attorney for Minnesota, said at a news conference. “Our investigations continue.”
Many of the companies claiming to serve food were sponsored by a nonprofit organization called Feeding Our Future, which submitted the companies’ claims for reimbursement. Feeding Our Future founder and executive director Aimee Bock was among those accused, and authorities say she and others within her organization filed the fraudulent claims for reimbursement and received kickbacks.
Bock’s attorney Kenneth Udoibok said the indictment “does not indicate guilt or innocence.” He said he would not comment further until he saw the indictment.
In interviews after law enforcement raided multiple locations in January, including Bock’s home and offices, Bock denied stealing money and said she never saw evidence of fraud.
Earlier this year, the US Department of Justice made prosecuting fraud related to the pandemic a priority. The department has already taken enforcement action related to more than $8 billion in alleged pandemic fraud, including indictments in more than 1,000 criminal cases with losses in excess of $1.1 billion.
Federal officials have repeatedly called the alleged fraud “brazen” and denounced it as a program aimed at feeding children in need of assistance during the pandemic. Michael Paul, special agent at the FBI’s Minneapolis office, called it “an amazing display of deception.”
Luger said the government was billed for more than 125 million fake meals, with some defendants making up names for children using an online random name generator. He showed a reimbursement form claiming that one location served exactly 2,500 meals each day Monday through Friday — without a child ever falling ill or otherwise missing from the program.
“These kids were just made up,” Luger said.
He said the government has recovered $50 million in money and property so far and expects more recoveries.
The Minnesota defendants face multiple charges including conspiracy, wire fraud, money laundering and bribery. Luger said some of them were arrested Tuesday morning. Authorities announced 47 charges at the press conference. A 48th person, who was scheduled to board a one-way flight to Ethiopia, according to a criminal complaint filed Tuesday night, was arrested some time after prosecutors’ press conference.
According to court documents, the alleged program targeted the USDA’s state child nutrition programs, which provide food for children and low-income adults.
In Minnesota, funds are administered by the state Department of Education, and children have historically been provided with meals through educational programs such as schools or daycares.
The places where the food is served are sponsored by public or non-profit groups like Feeding Our Future. The sponsoring agency retains 10 to 15 percent of the reimbursement monies as an administration fee in exchange for submitting applications, sponsoring the sites, and disbursing the monies.
However, during the pandemic, some of the standard requirements for sites to participate in federal nutrition programs have been waived.
The USDA allowed for-profit restaurants to participate and distribute food outside of educational programs. The indictment documents say the defendants took advantage of such changes “to enrich themselves”. (AP)