The Treasury Department announced Monday a new operation to root out schemes in which drug cartels use illegal immigrants’ identities to make fraudulent health care claims.
The Treasury’s Financial Crimes Enforcement Network issued a nationwide advisory for financial institutions to identify and report these illegal activities targeting Medicare and Medicaid.
Such fraud by illegal immigrants costs U.S. taxpayers more than $70 billion annually, according to the Treasury. A report issued by House Republicans last year found that more than 1 million illegal immigrants receive healthcare benefits.
The Treasury said illegal immigrants are filing claims with Medicare and Medicaid for nonexistent or unnecessary health care. Once the claims are paid, they funnel the money back to the transnational criminal organizations, often laundering the money through financial systems as digital assets. Medical professionals often agree to reimburse the phony medical procedures because they are receiving bribes and kickbacks, the Treasury said.
“President Trump has been clear that Americans have a right to know that their tax dollars are not being used to commit fraud,” Treasury Secretary Scott Bessent said. “Under President Trump’s leadership, Treasury will continue to find and disrupt fraud schemes wherever they exist and will work with our law enforcement partners to hold perpetrators to account.”
Under the initiative, whistleblowers who report healthcare fraud will be rewarded with up to 30% of the fine imposed by the government.
The Treasury’s announcement follows several moves by the Trump administration to crack down on the fraud in government programs. Vice President J.D. Vance last week kicked off the first meeting of the White House’s anti-fraud task force.
The task force, which Mr. Trump announced at last month’s State of the Union, is crafting a national strategy against fraud in state and local government programs that use federal dollars to provide food, housing, medical and financial assistance to the poor.
The effort will include anti-fraud protection, such as conducting audits and requiring proof of identity to get benefits.
Prosecutors estimate that as much as $9 billion in federal funds were fraudulently obtained from Minnesota-run social service programs since 2018. More than 100 people, mostly Somali immigrants, have been charged with a crime, and about 60 people have been convicted.
Mr. Bessent visited Minneapolis earlier this year and vowed that his department would announce measures to crack down on fraud.
