Fraud

CMS and its contractors have launched a coordinated enforcement surge against hospice providers in April 2026, targeting billing irregularities across California and expanding into Arizona, Nevada, Texas, Georgia, and Ohio. The Unified Program Integrity Contractor (UPIC) Qlarant is conducting predictive audits focused on three specific vulnerabilities: eligibility documentation gaps, extended stays exceeding 180 days, and rapid patient discharges that suggest billing churn. This enforcement wave follows the House Committee on Oversight and Accountability's March 23 investigation into $3.5 billion in alleged fraud centered in Los Angeles County, which demanded provider records from hospice operators. The timing coincides with implementation of the FY2026 Hospice Final Rule, effective October 1, 2025, which introduced mandatory HOPE quality tool reporting with a 90% compliance threshold or face 4% payment cuts. Providers under audit face payment suspensions and potential Office of Inspector General referrals.

Husch Blackwell LLP released a podcast on April 20, 2026, featuring attorney Hal Katz discussing compliance strategies for physician compensation arrangements under the False Claims Act and Stark Law. Host Jonathan Porter interviewed Katz, who had recently presented at the American Association of Orthopaedic Executives conference, on structuring referral-driven physician deals to avoid federal scrutiny. The episode examined common pitfalls including sham consulting contracts, opaque compensation formulas, and explicit statements linking payments to referrals—all of which trigger Department of Justice enforcement actions.

On March 26, 2026, California Attorney General Rob Bonta filed a lawsuit in San Diego County Superior Court against six individuals and three sham charities for allegedly operating fraudulent fundraising schemes at Petco Park and Snapdragon Stadium, diverting approximately $3.8 million in proceeds meant for youth programs into personal expenses like gambling, travel, dining, and entertainment.[1][2][3] The defendants exploited stadium programs allowing charities to staff concession stands with uncompensated volunteers in exchange for 10-12% of sales, but paid volunteers $50-$120 daily and pocketed up to $80,000 weekly per venue from 2014 to 2023, violating California's Charitable Supervision Act, registration requirements, and laws on fraud, conspiracy, and unjust enrichment.[1][2][3] The suit seeks injunctions, restitution of at least $3.8 million, punitive damages, civil penalties, and dissolution of the organizations.[1]

A federal court in Missouri has ordered Christopher Lee Carroll to pay over $140 million in consumer redress and civil penalties for operating a timeshare exit scheme that defrauded more than 11,000 consumers—predominantly elderly—of $90 million. The U.S. District Court for the Eastern District of Missouri granted summary judgment to the DOJ on behalf of the FTC and the State of Wisconsin on April 1, 2026. The court found Carroll, president and CEO of Square One Group LLC, was the "mastermind" behind the operation, which used high-pressure sales tactics, false claims of affiliation with timeshare companies, and systematic violations of the FTC's Cooling-Off Rule by denying refunds and three-day cancellations. Carroll faces a permanent injunction barring him from timeshare exit services, door-to-door sales, and any deceptive practices.

A federal grand jury in Montgomery, Alabama, indicted the Southern Poverty Law Center on April 22, 2026, on 11 counts: six counts of wire fraud, four counts of bank fraud, and one count of conspiracy to commit money laundering. The Department of Justice alleges that between 2014 and 2023, SPLC diverted more than $3 million in donor funds to individuals associated with violent extremist groups including the Ku Klux Klan, Aryan Nations, and the National Socialist Party of America. Prosecutors contend that SPLC misrepresented these payments to donors, who believed their contributions were funding efforts to combat such groups. According to the indictment, SPLC paid operatives and infiltrators—including one who received $270,000 and participated in planning the 2017 Unite the Right rally in Charlottesville—ostensibly to gather intelligence, but prosecutors argue the funds enabled criminal activity rather than dismantled extremist organizations.

Berg v. Bar-Lavi, a Section 225 stockholder dispute in Delaware Court of Chancery, ended with dismissal after the court found that plaintiff Berg had submitted fabricated corporate documents to establish his standing as a stockholder. Judge Lori W. Will ruled that Berg lacked valid stockholder status under DGCL § 108, rendering his written consents to appoint directors ineffective. The court characterized Berg's document fabrication as bad-faith conduct. Defendants Bar-Lavi and others faced lesser sanctions for false affidavit statements, with the court shifting 50 percent of fees to the defendants.

On April 20, 2026, the FTC filed two separate enforcement actions against deceptive earnings claims, including FTC v. Wellington. The filings target unsubstantiated income promises in business opportunities and multi-level marketing schemes, marking an escalation in the agency's long-standing enforcement program against such practices.