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Tag: 2021 News

Apple Resolves Pay for Security Checks Class Action for $29.9 M

Lead plaintiff Amanda Frlekin sued Apple Inc., the Cupertino-based technology giant in 2013, claiming it illegally withheld pay from workers who had to spend five to 20 minutes on average waiting for managers and security officers to search their bags and verify their Apple devices before they could leave for lunch breaks or at the end of shifts.

In 2015, Senior U.S. District Judge William Alsup granted summary judgment in favor of Apple, finding that because store employees chose to bring bags and Apple devices to work, they could not prove the bag checks were mandatory. He found Apple could have imposed an even stricter policy by banning workers from bringing bags or personal Apple devices to stores. This ruling gave rise to the decision by the California Supreme Court, and subsequent reversal of the summary judgment by the 9th Circuit in September 2020.

In a unanimous February 13, 2020 decision, the California Supreme Court in the case of Frlekin v. Apple Inc., held that the time spent by employees waiting for and undergoing security checks of bags and other personal items is compensable time under California law, even when the policy only applies to employees who choose to bring personal items to work.

Over the last several years, the question of whether the time employees spent having their bags checked at work is compensable has arisen in several different contexts, in California and across the country:

In late 2014, the U.S. Supreme Court in Integrity Staffing Solutions, Inc. v. Busk (135 S. Ct. 513, 574 US 27, 190 L. Ed. 2d 410) held that security checks are not compensable time under federal law because they are not part of the actual workday.

In California, employees in most industries must be paid for the time they are subject to the control of their employer, not just the time spent doing work. This is so because, since 1947, California has specifically departed from federal law and has provided greater protection to working employees.

This month, Apple has inched closer to ending more than eight years of litigation over claims it owes thousands of its retail employees in California for time spent undergoing security checks of their personal belongings.

Judgle Alsup granted preliminary approval to a $29.9 million settlement in an eight-page order issued Tuesday night.

Defendant Apple, Inc. employed settlement class members in its 52 retail stores in California. The total settlement is settlement worth $29.9 million A net of $18,895,333 will go to the class of 14,683 workers. Separately, Apple will pay $757,000 to cover the employer’s share of the payroll taxes owed on the wage portion of the settlement fund. Attorney fees and other costs will be separately decided.

Class attorney Lee Shalov of Mclaughlin and Stern in New York called it “the largest reported settlement in a security-search case in California.

Health Care Employers May Regret Vaccine Mandate Terminations

COVID-19 vaccine mandates have put some vital U.S health and safety institutions in a tough spot after cutting personnel who didn’t comply.

Overlapping federal mandates for military personnel, state mandates for health care workers, and other private mandates have created an increasingly difficult situation in the face of the omicron variant as numbers continue to surge in some states due to the much greater transmissibility of the variant.

Various states issued vaccine mandates for health care personnel in August, including California; Colorado; Illinois; Maryland; Rhode Island; New Mexico; Washington, D.C.; New York; Maine; Pennsylvania and New Jersey, with more to follow in the months after that.

But as thousands of health care workers faced termination over their refusal to comply, President Biden deployed over 1,000 military doctors, nurses, and medics to cover the shortage in the face of the omicron variant, which may further strain military health care services.  

“FEMA is deploying hundreds of ambulances and EMS crews to transport patients,” Biden said Monday during a call with the National Governors Association. “We’ve already deployed emergency response teams in Colorado, Michigan, Minnesota, Vermont, New Hampshire, and New Mexico. We’re ready to provide more hospital beds as well.”

New York already has recorded 90% capacity in a number of hospitals, halting elective procedures to focus on the surge. The state terminated or furloughed around 32,000 health care workers at nursing homes, hospitals, and other health providers as of Dec. 21, according to data provided to Fox News.

We have a massive nursing shortage,” Eric Smith, the statewide field director for the New York State Nurses Association, told the New York Daily News last month. “We have a vacuum in the double and triple digits all across the New York area.”

Massachusetts and New Jersey are among the states seeing spikes. Vaccine mandates in those states also led to hundreds of firings and resignations.

Some governors, such as Massachusetts Gov. Charlie Baker deployed National Guard members to help support hospitals, but even the Guard has faced its own loss of personnel due to the federal vaccine mandate.

Five governors called on the Pentagon to rescind the vaccine mandate for National Guard members, while Texas Gov. Greg Abbott outright refused to enforce it.

“As Governor of Texas, I am the commander-in-chief of this State’s militia,” Abbott wrote in a letter to Defense Secretary Lloyd Austin. “In that capacity, on October 4, 2021, I ordered the Adjutant General of Texas to comply with my Executive Order GA-39.”

“If unvaccinated guardsmen suffer any adverse consequences within the State of Texas, they will have only President Biden and his Administration to blame,” he explained.

More SCOTUS Litigants Join in OSHA Vaccine Mandate Case

American jurisprudence on vaccine mandates dates back over 100 years, but the Supreme Court will likely focus on a 40-year-old administrative precedent that is continually under fire to determine if President Joe Biden can require Covid-19 vaccines and testing for large private businesses.

Courthouse News reports that In the wake of a Sixth Circuit reversal last week, the high court has docketed over a dozen emergency applications in just the last two days challenging a federal mandate that would require businesses with over 100 employees to require Covid-19 vaccinations or weekly testing. The test-or-vaccine mandate is enforced through the Occupational Safety and Health Administration and is set to take effect on Jan. 4. Without relief from the court, 84 million workers will be affected.

The court has already seen multiple applications come across its shadow docket concerning state vaccine mandates. So far, it has declined to offer those individuals any relief. What that will mean for the OSHA mandate, however, is still unclear.

The OSHA ETS and the CMS Interim Final Rule litigation matters, each of which are headed to the Supreme Court now, present a new question as to whether the federal government agencies have exceeded their authority in implementing their respective vaccine-or-test and vaccine requirements,” Michelle Strowhiro, a partner at McDermott Will & Emery, said via email. “Therefore, while past decisions may be some indication, it is anyone’s guess how the Supreme Court will come out on this latest challenge.”

As the Sixth Circuit determined Friday, one must only read the agency’s name to understand it has this authority and that the vaccine mandate is distinct from August precedent that ended the federal eviction moratorium.

“In comparing this case with Alabama Association, the Fifth Circuit wrote, “But health agencies do not make housing policy, and occupational safety administrators do not make health policy.” The Fifth Circuit fails to acknowledge that OSHA stands for the Occupational Safety and Health Administration,” a 2-1 majority of the Sixth Circuit wrote Friday.

Ranging from Republican states and conservative organizations to business groups and construction workers, groups challenging the mandate claim that OSHA does not have the authority to mandate vaccines.

“For the vast majority of covered employees, the Covid-19-related risk presented by work is the same risk that arises from human interaction more broadly,” Ohio and 26 other states wrote in their brief. “The virus’s ‘potency lies in the fact that it exists everywhere an infected person may be – home, school, or grocery store, to name a few.’ Because it is not an occupational danger, it is not the sort of danger that the Emergency Provision empowers OSHA to address.”

The justices will have to decide if OSHA is acting within its authority to mandate vaccines.

“The big issue is whether the Supreme Court will show deference to the agency’s determination that this is necessary and that it’s an emergency,” Lawrence Gostin, a professor at Georgetown Law, said in a phone call.

Specifically, the court could apply the 1984 case Chevron USA Inc. v. Natural Resources Defense Council Inc., which says unless Congress has said otherwise, the courts should defer to agencies where the agency’s interpretation of the law is not unreasonable.  

“I think that the court’s new conservative majority, they’re flexing their muscles, and even with the well-established precedents, like Roe v. Wade or Chevron, they seem to be fully prepared to take a different path than the court has done for many decades,” Gostin said.

“There is some dispute between the circuit courts as to whether OSHA’s actions implicate the major questions doctrine, with the Fifth Circuit applying the doctrine in its order granting a nationwide injunction on enforcement, and the Sixth Circuit more recently finding no applicability in its order dissolving that stay,” Strowhiro said.

Another factor to consider when analyzing what the court could do in this case is that multiple justices regularly express their animosity to Chevron. Justice Clarence Thomas did so less than a month ago in a Medicare reimbursement case when he floated overturning the precedent. Justice Neil Gorsuch also seemed skeptical of the precedent implying that the government often uses deference for rules to their advantage.

California Gamemaker Ends Discrimination Class Action for $100 M

Riot Games announced that it has reached a global settlement agreement with the California Department of Fair Employment and Housing (DFEH), California Division of Labor Standards Enforcement (DLSE), and several private Plaintiffs to resolve the class-action gender discrimination litigation originally initiated as “McCracken vs Riot Games” in 2018.

Riot is headquartered in Los Angeles, California, and has 3,000+ employees in 20+ offices worldwide. The company was founded by Brandon Beck and Marc Merrill in 2006, and is currently led by CEO Nicolo Laurent.

The settlement covers a 2018 class action lawsuit filed by current and former Riot employees in the wake of a Kotaku report detailing systemic sexism and unfair treatment. The suit described an environment where male employees made derogatory sexual comments about female colleagues and passed them over for promotion, creating a company-wide “unwritten policy and practice of preferring men to women in the hiring, promotion, and compensation of its employees.”

Under the proposed consent decree, Riot will pay over $100 million to remedy violations against approximately 1,065 women employees and 1,300 women contract workers. The decree requires comprehensive injunctive relief in the form of workplace reforms, independent expert analysis of Riot’s pay, hiring, and promotion practices, and independent monitoring of sexual harassment and retaliation at Riot’s California offices for three years.

The decree will also resolve claims brought by the California Division of Labor Standards Enforcement (DLSE) in the first case jointly prosecuted by DFEH and DLSE.

In November 2018, former Riot employees filed a putative class action in Los Angeles Superior Court with private counsel and entered a proposed $10 million settlement of that action soon thereafter. In January 2020, both DFEH and DLSE objected to the proposed $10 million settlement. Both state entities then successfully intervened in the pending private action to protect the interests of the State and the women workers, and ensure the fairness of the resolution of the claims.

Both the DLSE and DFEH have jurisdiction to enforce the Equal Pay Act. This is the first case DFEH has litigated involving claims under that law, which the California Legislature authorized -DFEH to enforce starting January 2021 under SB 973 (Jackson).

Under the consent decree, Riot has agreed to:

– – Pay $100 million, of which a minimum of $80 million is dedicated to compensating workers. This amount includes $4 million in penalties under the Private Attorney General Act (PAGA), one of the largest such penalties assessed by the DLSE in its history.
– – Create a $6 million dollar cash reserve for each year of the three-year term of the consent decree (for a total of $18 million) to make pay adjustments and to fund diversity, equity, and inclusion programs.
– – Make available 40 full-time positions in engineer, quality assurance, or art-design roles to qualified class members who worked as temporary contractors in a competitive process.
– – Hire and pay for an independent third-party expert approved by DFEH to conduct a gender-equity analysis of employee pay, job assignments, and promotions each year for three years and remedy disparities that cannot be explained by bona fide, legitimate reasons.
– – Hire and pay for an independent third-party monitor approved by DFEH to audit compliance with workplace protections, including a review of complaint investigations and outcomes, each year for three years.

Women who worked as employees or contractors for Riot since November 6, 2014 may be eligible to receive compensation. Additional information will be posted on DFEH’s website following entry of the consent decree by the court.

Final approval of the settlement by the court is pending, with a hearing expected in the coming months.

Global TPA Market to Reach $514.98 Billion by 2030

There is rapid demand for insurance third party administrator (TPA) for handling the claims of worker’s compensation offered by employment firms under employee benefits. In addition, TPAs are used to manage company’s group benefits, particularly health, workers compensation, and dental claims that are typically self-funded.

A new study published by Allied Market Research reports that the insurance third party administrator market size was valued at $280.69 billion in 2020, and is projected to reach $514.98 billion by 2030, growing at a CAGR of 6.3% from 2021 to 2030.

Rapid adoption of third party administrators in the health insurance industry and rise in need for operational efficiency & transparency in insurance business process are some of the factors propelling the insurance third party administrator market growth. However, security issues and privacy concerns are the major factors limiting the market growth.

On the contrary, technological advancements in third party administrator, such as adoption of Internet of things (IoT), artificial intelligence, machine learning, and robotics process automation, have led to the growth of the insurance third party administrator industry.

Furthermore, artificial intelligence technology has claims administration with predictive outcomes, wherein a low-cost claim can be identified automatically through processing & eliminating the need for claim adjustment intervention. Thus, the demand for insurance third party administrator market is expected to grow tremendously in the coming years.

The insurance third party administrator market is fragmented with the presence of regional vendors such as CRAWFORD & COMPANY, SEDGWICK, and Charles Taylor. North America dominated the insurance third party administrator market, in terms of revenue in 2020, and is expected to retain their dominance during the forecast period. However, Asia-Pacific is anticipated to experience significant growth in the future as insurance TPAs play an important role in terms of enhancing customer relationships and delivering niche & unique insurance third party administrator services in this region.

The report analyzes the profiles of key players operating in the insurance third party administrator market such as Charles Taylor, CORVEL, CRAWFORD & COMPANY, ESIS, ExlService Holdings, Inc., GALLAGHER BASSETT SERVICES, INC., Helmsman Management Services LLC, Meritain Health, SEDGWICK, and United HealthCare Services, Inc. These players have adopted various strategies to increase their market penetration and strengthen their position in the insurance third party administrator market.

The outbreak of COVID-19 is anticipated to provide growth opportunities for the Insurance third party administrator market expansion during the forecast period, owing to rise in digital transformation trend in insurance and surge in demand for third party administration solutions that are hosted or managed on the cloud.

Moreover, during the pandemic, there is a rising number of claims in health insurance. Therefore, to effectively handle such high number of claims, the insurance companies are heavily investing in third party administrator services. Thus, these factors ensure that insurance companies are considering third party administrators for improving cost efficiency and business operations during the pandemic situation.

RAND Study Shows 21% Decline in Opioid Prescribing

The volume of prescription opioids dispensed from retail pharmacies declined by 21% from 2008 to 2018, but the decline was not uniform across geographic areas, among types of patients, or by type of prescriber, according to a new RAND Corporation study.

The study, published by the Annals of Internal Medicine, is the first to examine the decline in opioid prescriptions filled at retail pharmacies based on both volume and potency of the drugs dispensed.

“The findings do not provide concrete answers about how much of the unnecessary prescribing of opioids has been eliminated,” said Dr. Bradley D. Stein, the study’s lead author and a senior physician researcher at RAND, a nonprofit research organization. “But the work demonstrates that there is a lot more nuance in the changes in opioid prescribing than we previously understood.”

There is wide agreement that the overprescribing of opioid medication for pain was a key driver in creation of the U.S. opioid crisis, which has led to widespread addiction and now kills more than 100,000 Americans annually.

State, federal, and private initiatives have been undertaken to encourage physicians and other health providers to reduce the number of prescriptions written for opioids to treat pain. The number of opioid prescriptions peaked in 2011.

RAND researchers examined differences in opioid prescriptions filled at pharmacies during the periods of 2008 through 2009 and 2017 through 2018. The prescription information came from IQVIA Prescription data, which captures about 90% of prescriptions filled at U.S. retail pharmacies.

They used days’ supply and total daily opioid dose to calculate per capita morphine milligram equivalents (MME) for opioid prescriptions filled during the study period. Because opioids are available in different forms, this measurement provides a better assessment of the total amount of opioids filled by patients as compared to just the number of pills dispensed.

The study found that over the study period, per capita MME volume declined the most in metropolitan counties (more than 22%) and in counties with higher rates of fatal opioid overdoses (a 35% decline).

Substantial variation existed both within and across states. In some states, MME volume per capita increased in multiple counties. In many other states, there were both counties with increases and others with substantial decreases. Counties that experienced substantial decreases in per capita MME often were adjacent to counties with per capita increases.

Most clinical specialties recorded declines in the MME volume per practicing clinician. The greatest decrease in MME volume per practicing clinician was among adult primary care physicians (40% decline) and pain specialists (15% decline)—the clinicians with the highest MME volume per clinician in 2008–2009.

The greatest percentage decrease was among emergency physicians (71% decline)—clinicians who are likely prescribing opioids predominantly to patients experiencing acute pain in acute care settings.

“These results suggest the effects of clinician and policymaker efforts to reduce opioid prescribing have affected populations differently,” Stein said. “Future efforts to enhance clinically appropriate opioid prescribing may need to be more clinically nuanced and targeted for specific populations.”

DCA Clarifies IFPA “First-to-File” Rule in Published Decision

The California Insurance Fraud Protection Act (IFPA) allows qui tam plaintiffs to file lawsuits on the government’s behalf and seek monetary penalties against perpetrators of insurance fraud. Under the IFPA, a defrauder is assessed penalties for each fraudulent insurance claim it presented to insurers. To prevent duplicative lawsuits, the IFPA contains a “first-to-file rule” that bars parties from filing subsequent actions related to an already pending lawsuit.

State Farm Mutual Automobile Insurance Company filed an IFPA action alleging defendants Sonny Rubin, M.D., Sonny Rubin, M.D., Inc., and Newport Institute of Minimally Invasive Surgery fraudulently billed insurers for various services performed in connection with epidural steroid injections.

However, a month prior Allstate filed a separate IFPA lawsuit against the same defendants, alleging they were perpetrating a fraud on Allstate, also involving epidural steroid injections.

In the State Farm lawsuit, the trial court sustained defendants’ demurrer to State Farm’s complaint under the IFPA’s first-to-file rule, finding it alleges the same fraud as Allstate’s complaint

State Farm appealed, arguing its complaint alleges a distinct fraud. The Court of Appeal agreed that the demurrer was incorrectly sustained, but for another reason in the published case of P. ex rel. State Farm Mutual Automobile Ins. Co. v. Rubin 12/14/21 CA4/3.

In applying the rule, the trial court and both parties only focused on whether the two complaints allege the same fraudulent scheme. But, in this matter of first impression, the Court of Appeal finds the IFPA’s first-to-file rule requires an additional inquiry.

Courts must also review the specific insurer-victims underlying each complaint’s request for penalties. If each complaint seeks penalties for false insurance claims relating to different groups of insurer-victims, the first-to-file rule does not apply.

A subsequent complaint is only barred under the first-to-file rule if the prior complaint alleges the same fraud and seeks penalties arising from the false claims, submitted to the same insurer-victims.

Here, both complaints largely seek penalties relating to separate pools of victims. Allstate’s complaint only seeks IFPA penalties for the false insurance claims that defendants presented to Allstate. State Farm’s broader action seeks penalties for all the false insurance claims that defendants submitted to any insurer. Allstate is the only overlapping victim.

Thus, even if the two complaints allege the same fraud, State Farm is only precluded from pursuing IFPA penalties for the false claims that defendants billed to Allstate. As to the other inquiry, there is partial overlap between the fraudulent schemes alleged in the complaints.

Both complaints allege a common scheme in which defendants presented false claims to insurers pertaining to epidural steroid injections. However, State Farm’s complaint also alleges a distinct scheme involving false charges for magnetic resonance imaging (MRI) interpretations that defendants billed independently from epidural spinal injections.

For the portion of State Farm’s action based on MRI charges billed independently from epidural spinal injections, State Farm may pursue penalties for any false claims that defendants submitted to any insurer, including Allstate.

Lien Claimant Must Meet CCP 473 Criteria for Relief From Default

Yeny Garcia resolved his industrial claim against Securitas Security Services USA by way of compromise and release on September 10, 2015.

On October 21, 2016, Delmar Medical Imaging filed its Notice and Request for Allowance of Lien. The declaration attached by the notice did not include the language found in section 4903.8(d)(1) or (d)(2).

On August 21, 2017, Delmar submitted an “Amended Declaration Pursuant to Labor Code Section 4903.8(d),” which included the language found in section 4903.8(d)(1) and (d)(2).

The WCJ found that lien claimant’s lien was invalid when filed on October 21, 2016 and that the “amended” lien filed on August 21, 2017, was untimely. The lien claimant was required to file its lien no later than 18 months after the last day of service. Thus the lien claimant’s lien was barred by the statute of limitations and the provisions of Code of Civil Procedure section 473 were not met, and thus could not be used to allow them to amend the lien.

Based on these findings, the WCJ ordered lien claimant’s lien dismissed, and that it take nothing on its lien.

The Petition for Reconsideration filed by Delmar was denied in the panel decision of Garcia v Securitas Security Services USA.

“A lien claimant may seek relief . . . by utilizing a procedure substantially similar to Code of Civil Procedure section 473 . . . .” (Fox v. Workers’ Comp. Appeals Bd. (1992) 4 Cal.App.4th 1196, 1205-1206.) Code of Civil Procedure section 473(b).

CCP 473 allows a party to be relieved from “a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect” provided the “application for relief is made no more than six months after entry of judgment….”

In this case Delmar called Ms. Ghorbanian as a witness to support relief pursuant to CCP 473.

This WCJ assessed Ms. Ghorbanian’s overall testimony, demeanor and determined that it was self-serving and did not demonstrate inadvertence, surprise, mistake or excusable neglect required by Code of Civil Procedure section 473.

“She made contradictory statements about her knowledge of requirements for the Declaration. She placed reliance on a filing and document system authorized by an approved vendor. There was no testimony about any independent investigation, research, training, or other attempts to verify that the lien was properly filed with complete, accurate and required documents at the time of filing. She further justified the lack of her own verification of a proper filing because there was no contemporaneous objection made by Defendant when the lien was filed and served.”

Top Court Sets Jan. 7 Oral Argument in Vaccine Mandate Appeals

In an announcement on Wednesday, the U.S. Supreme court said that on January 7, it would hear oral arguments on separate disputes challenging the Biden administration’s mandate for businesses with more than 100 employees, and for some 17 million health care workers at facilities receiving Medicaid and Medicare funding.

The court, which has a 6-3 conservative-leaning majority, delayed action on emergency requests in both cases that sought an immediate decision. The workplace mandate is currently in effect nationwide, while the health care worker mandate is blocked in half of the 50 U.S. states.

The mandate for health care workers was issued last month by the Centers for Medicare and Medicaid Services (CMS), and affects roughly 17 million workers. It requires facilities that receive Medicare or Medicaid funding to require workers to get vaccinated, and has no testing opt-out.

The deadline for meeting the mandate is Jan. 4, 2022. However, OSHA said on Dec. 18 that it would not be issuing fines to businesses for noncompliance until Jan. 10.

The Biden administration’s private employer COVID-19 vaccine mandate, meanwhile, was promulgated by the Department of Labor’s Occupational Safety and Health Administration (OSHA). If allowed to take effect next month, it will force every business with 100 or more employees to require proof of a negative COVID-19 test on at least a weekly basis or proof of vaccination from each worker. Companies that don’t comply would face escalating fines.

The White House on Wednesday said that it is “confident in the legal authority for both policies.”

The announcement comes as the Biden administration ramps up its messaging for Americans to get vaccinated and receive their booster shots.

The Omicron variant of the novel coronavirus on Monday became the dominant source of new infections in the United States, accounting for roughly 73 percent of new infections nationwide, according to data from the Centers for Disease Control and Prevention (CDC).

Federal officials cited CDC figures for the week ending Dec. 18 that showed a nearly six-fold increase in Omicron’s share of infections in only one week.

Infectious diseases expert Dr. Anthony Fauci on Dec. 17 floated the idea of redefining what it means to be fully vaccinated in the United States.

Currently, individuals are considered fully vaccinated after taking their second dose of a two-dose series, such as the Pfizer-BioNtech vaccine, or after a single-dose vaccine, such as the Johnson & Johnson vaccine.

However, Fauci told CNBC’s “Squawk Box” last week that a redefinition of being fully vaccinated is “on the table.”  “There’s no doubt that optimum vaccination is with a booster,” he said.

“Whether or not the CDC is going to change that, it certainly is on the table and open for discussion. I’m not sure exactly when that will happen. But I think people should not lose sight of the message that there’s no doubt if you want to be optimally protected, you should get your booster.”

Secret Service Says Cost of COVID-relief Funds Fraud is $100 B

Nearly $100 billion of COVID-relief funds have been fraudulently obtained in the US since the government rolled out the benefits during the pandemic, officials said.

The Secret Service revealed the massive figure in a Tuesday press release announcing the existence of new measures to capture cheats and seize the stolen funds.

The U.S. Secret Service has named Assistant Special Agent in Charge (ASAIC) Roy Dotson of the Jacksonville field office as the National Pandemic Fraud Recovery Coordinator. In this role, ASAIC Dotson will coordinate efforts across multiple ongoing Secret Service investigations into the fraudulent use of COVID-19 relief applications.

The Secret Service has seen a huge uptick in electronic crime in furtherance of these fraud cases,” Dotson continued. “Criminals will often ask potential victims to open an account and move money for them for some reason as part of a ruse.” Fraudsters, for example, prey on people by engaging them online as part of a romance scam, phony job opportunity or other scheme, and then asking for financial favors. “Targeted individuals are often asked to open bank accounts and accept large sum deposits,” Dotson said. “As a result, people are becoming unwitting mules for stolen money.”

While fraud related to personal protective equipment (PPE) was of primary concern to law enforcement, including the Secret Service, early in the pandemic, the release of federal funding through the Coronavirus Aid, Relief and Economic Security (CARES) Act has attracted the attention of individuals and organized criminal networks worldwide. The exploitation of pandemic-related relief is an investigative priority for the Secret Service and its partners.

As part of his duties as National Pandemic Fraud Recovery Coordinator, ASAIC Dotson will coordinate with financial institutions and money services businesses, United States Attorney Offices, and other federal agencies regarding large-scale seizures of illicitly obtained pandemic relief funds. This includes unemployment insurance (UI), U.S. Small Business Administration (SBA) loan and grant programs, and other benefit programs.

The Secret Service currently has more than 900 active criminal investigations into fraud specific to pandemic-related relief funds,” said Dotson.  “That’s a combination of pandemic benefits and all the other benefits programs too. Every state has been hit, some harder than others. The Secret Service is hitting the ground running, trying to recover everything we can, including funds stolen from both federal and state programs.”

To date, Secret Service investigations and investigative inquiries into UI and SBA loan fraud have resulted in the seizure of more than $1.2 billion and the return of more than $2.3 billion of fraudulently obtained funds via Automated Clearing House reversals.

These investigations have led to the arrest of 100 individuals responsible for UI and SBA loan fraud. The Secret Service continues to work closely with the U.S. Department of Labor and SBA Offices of Inspectors General (OIG), and the Pandemic Response Accountability Committee (PRAC) on identifying and preventing these crimes.