In Congressional testimony, AG Holder touts success in fraud cases

by Ben Vernia | June 7th, 2012

On June 7, Attorney General Eric Holder appeared before the House Judiciary Committee. In prepared remarks, he commented on the Department’s efforts to combat fraud, including through the False Claims Act:

Good morning, Chairman Smith, Ranking Member Conyers, and distinguished members of the Committee. Thank you for the opportunity to appear before you today – and for your continued support of the Justice Department, and the goals that we share. I appreciate the chance to discuss some of the key accomplishments that have distinguished the Department’s work throughout this Administration – and to outline our plans to build upon this record of achievement.
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Since the start of this Administration, the Justice Department has signaled an unwavering commitment to preventing and combating a wide range of financial and health-care fraud crimes. We’ve taken bold steps to address the contributing factors and consequences of the recent economic crisis. And this work is paying dividends.

Last year alone, the Department’s Consumer Protection Branch – working with U.S. Attorneys’ Offices across the country – attained a 95 percent conviction rate; secured more than $900 million in criminal and civil fines, restitution, and penalties; and obtained sentences totaling more than 130 years of confinement against more than 30 individuals. In cooperation with the Department of Housing and Urban Development and a bipartisan group of 49 state attorneys general, we achieved a $25 billion settlement with five of the nation’s top mortgage servicers – the largest joint federal-state settlement in history. Through the efforts of the President’s Financial Fraud Enforcement Task Force – which was launched in 2009 – we’ve obtained prison sentences of up to 60 years in a variety of fraud cases – including multimillion-dollar Ponzi schemes and the largest hedge-fund insider-trading case in U.S. history. We’ve established two new Working Groups to enhance civil and criminal enforcement of consumer fraud and to bring federal and state authorities together in investigating and prosecuting misconduct by financial institutions in the origination, securitization and servicing of mortgages that contributed to our financial crisis. And we’ve continued to make tremendous gains in our work to combat health-care fraud.

In fact, over the last fiscal year – in cooperation with the Department of Health and Human Services and other partners, and by utilizing authorities provided under the False Claims Act and other essential statutes – we recovered nearly $4.1 billion in cases involving fraud on federal health-care programs. That’s the highest amount ever recovered in a single year. And for every dollar we’ve spent combating health-care fraud, we’ve returned an average of seven dollars to the U.S. Treasury, the Medicare Trust Funds, and others.

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