A New Sheriff for Fraud — What the DOJ Just Built
Fraud costs Americans hundreds of billions of dollars every year. For decades, the federal government fought it piecemeal — healthcare fraud here, tax fraud there, wire fraud somewhere else. Different sections, different supervisors, different priorities. Scammers exploited those gaps.
That changed on April 7, 2026, when Acting Attorney General Todd Blanche signed a memorandum formally establishing the National Fraud Enforcement Division (NFED) — a dedicated, centralized unit inside the Department of Justice focused entirely on the investigation and prosecution of fraud against taxpayer dollars and taxpayer-funded programs.
It is the most significant restructuring of federal fraud enforcement in a generation. And it is already producing results.
Who Is Running It — and Why That Matters
The NFED is led by Colin M. McDonald, who was sworn in as its first Assistant Attorney General on April 1, 2026 — one week before the division was formally established. McDonald is not a political newcomer. He has served in multiple DOJ roles since 2014, including as an Associate Deputy Attorney General, an Assistant United States Attorney in the Southern District of California, and as a Special Attorney to the Attorney General in the District of Hawaii.
His confirmation drew rare bipartisan support. Senate Judiciary Committee Chairman Chuck Grassley publicly backed him, calling him the right person to lead a “fraud-fighting” division with real teeth.
McDonald reports directly to the Attorney General — meaning fraud prosecutorial decisions can be made at the highest levels of the department without getting lost in bureaucratic chains of command that historically slowed cases down.
What the NFED Replaced — and What It Merged
The NFED did not start from scratch. Effective immediately upon its creation, the division assumed operational control of three existing Criminal Division components that had previously operated independently:
- The Tax Section — responsible for prosecuting federal tax fraud and evasion
- The Health Care Fraud Unit — the primary federal body pursuing Medicare and Medicaid fraud
- The Market, Government, and Consumer Fraud Unit — covering everything from investment fraud to pandemic relief scams to wire fraud targeting consumers
By consolidating these three units under a single Assistant Attorney General, the DOJ gains something it never had before: a unified command structure for fraud. Cases involving overlapping fraud types — say, a healthcare provider who also commits tax fraud and consumer deception — can now be pursued by a single coordinated team rather than three parallel offices that may or may not communicate with each other.
The NFED is also building a National Fraud Detection Center, designed to systematize data sharing between federal law enforcement agencies and make enforcement faster and harder for fraudsters to anticipate.
”This Week in Fraud” — The $1 Billion Enforcement Blitz
One of the NFED’s first public moves was launching a recurring enforcement announcement series called “This Week in Fraud” — a weekly summary of the division’s active prosecutorial actions across the country.
The debut edition was staggering in scope. Among the actions announced:
- $2 million seized from Expert Wound Care PC, a California-based clinic accused of submitting fraudulent Medicare claims. Prosecutors allege the clinic billed Medicare for more than $46.6 million in fraudulent claims between September 2025 and April 2026.
- A coordinated international takedown of scam call centers that resulted in at least 276 arrests across multiple countries. These operations had targeted American victims for millions of dollars in losses through phone-based imposter scams.
- Multiple indictments spanning healthcare fraud, government benefits fraud, and consumer fraud — each representing millions of dollars in alleged theft from taxpayers.
The “This Week in Fraud” series is a deliberate signal: the NFED intends to make fraud prosecution visible, predictable, and relentless. Fraudsters who assumed they could operate in obscurity now face a division that publishes its enforcement actions weekly.
The West Coast Healthcare Fraud Strike Force
On April 30, 2026 — just over three weeks after the NFED’s creation — the division announced its first major operational initiative: a new West Coast Health Care Fraud Strike Force.
The Strike Force operates out of offices in San Francisco, Las Vegas, and Phoenix, targeting three states that federal investigators had flagged for rising Medicaid, hospice, and tech-enabled healthcare fraud: Arizona, Nevada, and Northern California.
The Strike Force brings together the NFED’s Health Care Fraud Section and U.S. Attorneys’ Offices across all three districts, working in close collaboration with the FBI, the Department of Health and Human Services Office of Inspector General, the Drug Enforcement Administration, and state-level law enforcement.
The industries in the crosshairs include:
- Hospice fraud — billing Medicare for terminal care patients who are not actually dying, or billing for services never rendered
- Sober home fraud — residential addiction treatment facilities submitting false claims for therapy and medication
- Wound care fraud — clinics billing Medicare for wound care visits and procedures that did not occur
Cases Already in Motion
The West Coast Strike Force had barely launched when prosecutors announced major actions:
The $267 Million Medi-Cal Hospice Scheme — California prosecutors charged 21 defendants in a sprawling hospice fraud operation. Investigators allege the defendants used stolen patient identities and shell hospice companies to bill Medi-Cal for services that were never provided.
The $50 Million Medicare Hospice Scam — Federal prosecutors in the Central District of California charged eight defendants, including licensed healthcare professionals and facility operators, for allegedly running hospice companies that billed Medicare for patients who were not terminally ill.
Why Fraud Against Government Programs Hurts Everyone
Healthcare fraud alone costs the United States government an estimated $100 billion per year, according to the National Health Care Anti-Fraud Association. That money does not disappear — it comes directly out of programs that serve real patients. When bad actors bill Medicare for services never rendered, legitimate beneficiaries face coverage delays, administrative burdens, and in some cases actual gaps in care.
Tax fraud and consumer fraud compound the damage. Every dollar stolen through fraudulent means is a dollar the government either does not collect or pays out incorrectly — dollars that ultimately affect public services, tax rates, and program funding for ordinary Americans.
What This Means for Fraud Victims
If you or someone you know has been defrauded — especially by a healthcare provider, benefits program, or government imposter — the NFED’s creation matters in concrete ways:
Reporting is now more likely to result in action. The NFED’s National Fraud Detection Center is being built to aggregate and analyze fraud reports systematically. A complaint that might have sat in one agency’s queue can now contribute to a nationwide enforcement pattern.
Cases involving multiple fraud types will move faster. If your case involves both healthcare billing fraud and identity theft, a unified division can pursue both angles without interagency handoffs that have historically delayed investigations.
High-profile prosecutions send deterrent signals. The “This Week in Fraud” series is as much a message to would-be fraudsters as it is a public record — the DOJ is watching, it is organized, and it is publishing results weekly.
How to Protect Yourself and Report Fraud
Report healthcare fraud. If a provider has billed your insurance for services you never received, report it to the HHS Office of Inspector General at oig.hhs.gov or call 1-800-HHS-TIPS.
Report tax fraud and identity fraud. The IRS operates a dedicated Tax Fraud Referral Program at irs.gov/compliance/criminal-investigation.
Report consumer fraud and scams. File reports with the FTC at ReportFraud.ftc.gov. Your report contributes to the data that drives enforcement priorities.
Know the red flags of government imposter scams. Real federal agencies do not demand payment by gift card, cryptocurrency, or wire transfer. They do not call you threatening immediate arrest. If you receive such a contact, hang up and report it.
The DOJ has made its priorities clear. Now it is up to consumers and healthcare system participants to use the reporting channels that feed the enforcement machine the NFED is building.
