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Hundreds of people have been charged with the theft of more than $830 million in COVID-19 emergency aid following a nationwide operation conducted by federal, state and local law enforcement agencies, the U.S. Justice Department announced yesterday, the Associated Press reported. More than 60 of the defendants have alleged connections to organized crime, the department said, including members of a criminal gang accused of using stolen pandemic aid to pay for a murder. “This latest action, involving over 300 defendants and over $830 million in alleged COVID-19 fraud, should send a clear message: the COVID-19 public health emergency may have ended, but the Justice Department’s work to identify and prosecute those who stole pandemic relief funds is far from over,” Attorney General Merrick Garland said in a statement. The three-month operation, which ended in July, resulted in more than 300 people being charged,, underscoring the pervasiveness of the fraud. “We’ll stay at it for as long as it takes,” said Deputy Attorney General Lisa Monaco, who led a meeting of law enforcement officials livestreamed on the Justice Department’s website. An Associated Press analysis published in June found that fraudsters potentially stole more than $280 billion in COVID-19 relief funding; another $123 billion was wasted or misspent.

Hundreds of Native Americans who have been targeted by Phoenix-area scammers as the billing schemes often left clients homeless and in some cases financed lavish lifestyles for the fraudulent providers, authorities have said, the Associated Press reported. Arizona has been defrauded in recent years out of hundreds of millions of dollars through such scams, state officials estimated. The fraudulent charges were submitted mostly through the American Indian Health Program, a Medicaid health plan that allows providers to bill directly for reimbursement of services rendered to American Indian and Alaska Native tribal members. Federal law lets Native Americans choose the fee-for-service plan or a managed care plan. The state Medicaid program known as AHCCCS — Arizona Health Care Cost Containment System — contracts with managed care organizations to provide health services to most Medicaid members in Arizona, while the fee-for-service plan allows American Indians to use any provider registered with AHCCCS. The scams’ far-reaching consequences are now becoming known as warnings are sounded by state and tribal governments outside Arizona, as well Sen. Jon Tester (D-Mont.) and Montana Gov. Greg Gianfonte (R).

UBS will pay U.S. authorities $1.44 billion to settle the last lingering legal case over Wall Street's role in the housing bubble of the early 2000s, which ultimately led to the 2008 financial crisis and Great Recession, the Associated Press reported. The Swiss bank agreed to pay a civil penalty over how it handled the sale of 40 mortgage-backed securities issued in 2006 and 2007. The settlement argues that UBS bankers gave false and misleading statements about the health of the mortgages in those bonds to the buyers in violation of federal securities law. For example, UBS bankers knew that the underlying mortgages in these bonds were poorly underwritten or violated consumer protection laws. The bonds in question ended up with substantial losses for investors. With the UBS settlement, the last remaining outstanding legal case from the Great Recession has now come to a close, the Justice Department said. Banks paid collectively more than $36 billion in civil penalties for their conduct related to the mortgage crisis, but that does not include other settlements that banks have made to state and local authorities as well.

Alex Mashinsky, the founder and former chief of the now-bankrupt cryptocurrency lender Celsius Network, must face a lawsuit by New York Attorney General Letitia James accusing him of civil fraud, a Manhattan state court judge ruled on Friday, Reuters reported. Justice Margaret Chan said the attorney general sufficiently alleged that Mashinsky defrauded investors by touting Celsius as a safe alternative to banks and concealing its risks, including hundreds of millions of dollars of investment losses. Judge Chan also said James could pursue some claims under the Martin Act, a powerful state securities law, and that the "earned interest accounts" that Celsius offered customers qualified as securities under state law. The attorney general's lawsuit "supports a reasonable inference that the harm suffered by investors flowed, at least in part, from Mashinsky's alleged misrepresentations made in New York concerning Celsius' overall financial health and investment safety," Chan wrote in a 25-page decision.

The U.S. Securities and Exchange Commission (SEC) sued internet marketer Richard Schueler, known online as Richard Heart, and his projects Hex, PulseChain and PulseX, alleging he raised over $1 billion across three different unregistered securities offerings beginning in 2019, CoinDesk.com reported. Heart also defrauded his investors, the SEC alleged in a lawsuit on Monday, by using investor funds for personal goods. "Heart continually touted these investments as a pathway to grandiose wealth for investors, claiming that Hex, for example, 'was built to be the highest appreciating asset that has ever existed in the history of man,'" the lawsuit said. "... Although Heart claimed these investments were for the vague purpose of supporting free speech, he did not disclose that he used millions of dollars of PulseChain investor funds to buy luxury goods for himself." PulseX and PulseChain launched earlier this month, but faced rocky starts in the weeks immediately after going live, seeing high fees, liquidity issues and exploitable bugs. The prices of the HEX, PLS and PLSX tokens fell post-launch.

Alex Mashinsky, founder and former CEO of bankrupt cryptocurrency lender Celsius Network, pleaded not guilty yesterday to U.S. fraud charges that he misled customers and artificially inflated the value of his company's propriety crypto token, Reuters reported. Three federal regulatory agencies also sued Mashinsky and Celsius in connection with the case. Mashinsky was charged with seven criminal counts — including securities fraud, commodities fraud and wire fraud — according to an indictment unsealed earlier on Thursday. He is one of several crypto moguls to be indicted in another blow for the industry, which is undergoing a reckoning after a slump in crypto prices led to the collapse of several companies, including exchange giant FTX. That company's founder, Sam Bankman-Fried, was charged with fraud last year, and has pleaded not guilty. U.S. Magistrate Judge Ona Wang said Mashinsky would be released on a $40 million bond secured by his Manhattan residence.

U.S. prosecutors on Wednesday unveiled an indictment charging a second former executive of college financial aid startup Frank with defrauding JPMorgan Chase into buying the company for $175 million, Reuters reported. Olivier Amar, who was Frank's chief growth officer, was charged with wire fraud, bank fraud, securities fraud and conspiracy. Frank founder Charlie Javice was arrested in April and later pleaded not guilty to the same four counts. Lawyers for Amar, whose whereabouts were not immediately known, did not immediately respond to a request for comment. A spokesman for the U.S. Attorney's office in Manhattan also did not immediately respond to a request for comment. Federal prosecutors have said that Javice repeatedly lied about Frank to the largest U.S. bank, including by claiming that she had lined up 4.25 million student customers when in fact she had data for only about 300,000.