Benefits Fraud
What is Benefits Fraud?
Benefits fraud refers to the act of obtaining financial assistance from the government that a person is not entitled to receive [1]. Typically, benefits fraud involves falsifying information in order to qualify for the benefits [2], however, other schemes involve identity theft and impersonation to obtain benefits [3], use of benefits for ineligible purposes, and outright theft of benefits [4].
Ranging from income support to utility assistance, benefit programs are designed to assist target demographics, like veterans, low-income families, or the elderly or disabled [5]. For example, the largest income-maintenance program in the U.S., the Old-Age, Survivors, and Disability Insurance (“OASDI”), also known as Social Security, provides monthly benefits to replace the loss of income due to retirement, death, or disability [6]. Medicaid is a safety net that provides health care to eligible low-income individuals and covers Medicare premiums for individuals enrolled in both Medicaid and Medicare [7]. Supplemental Nutritional Assistance Program (“SNAP”), provides food benefits low-income families [8], while Temporary Assistance for Needy Families (“TANF”), acts as another income maintenance program for eligible low-income families [9]. Other major programs include Unemployment Insurance (“UI”), housing assistance programs from the Department of Housing and Urban Development (“HUD”) [10], and the preschool program Head Start [11].
Detecting benefits fraud, like detecting most fraud [12], remains a challenge for authorities [13]. Major challenges include a high volume of benefits applications, processing times, and the ease with which bad actors can obtain beneficiaries’ personally identifiable information [14].
What is the Impact of Benefits Fraud?
Benefit programs act as lifelines for millions of Americans. The United States spends trillions of dollars on these programs each year [15]. In fiscal year 2025, the U.S. spent $1.7 trillion on Social Security and another $1.8 trillion on Medicare [16]. In the same year, the U.S. spent $161.7 billion on food and nutrition assistance, $76.6 billion on housing assistance, and $46.6 billion on unemployment compensation [17]. Fraud in these programs costs not just the taxpayer, but also beneficiaries themselves. Maintaining the integrity of benefit programs is critical to ensure their longevity.
In 2025, the Veteran’s Administration reported $37.34 million of confirmed losses due to fraud [18]. The Social Security Administration reported $143.25 million of confirmed losses to fraud in that same year [19]. HUD reported confirmed fraud reaching $30.52 million in 2023 [20]. These examples showcase the costs associated with fraud and the potential risks to essential benefit programs.
Recent Enforcement Trends
The current Administration has signaled a re-emphasis on pursuing benefits fraud after reports of alleged benefits fraud in healthcare and childcare programs arose in Minnesota [21]. In recent weeks, the Civil Division of the Department of Justice (“DOJ”) announced that agency would be fast-tracking their review of whistleblower suits under the False Claims Act [22]. The move is part of the Administration’s Task Force to Eliminate Fraud and the National Fraud Enforcement Division launched earlier this year [23].
Recent Settlements
August 22, 2025: Nine Medicaid recipients agreed to pay $173,627 to settle allegations that they falsified income to unlawfully create eligibility for Medicaid health benefits [24].
May 6, 2025: A broadband provider allegedly submitted claims for broadband services for subscribers ineligible for the Emergency Broadband Benefits Program/Affordable Connectivity Program, and submitted other false information to the Federal Communications Commission [25].
Why Whistleblowers Can Help Combat Benefits Fraud
Whistleblowers play a critical role in detecting and combating benefits fraud. The False Claims Act (“FCA”) empowers private individuals, known as relators, to file qui tam lawsuits on behalf of the federal and state governments against those who defraud benefit programs. If the government recovers funds, the whistleblower may be entitled to receive between 15% and 30% of the recovery as a reward. The FCA also includes robust anti-retaliation protections, shielding whistleblowers from termination, demotion, harassment, or other adverse employment actions taken in response to protected activity, such as reporting the suspected fraud internally or filing a qui tam lawsuit. Given the DOJ’s recent prioritization of benefits fraud cases and its fast-tracking of FCA whistleblower suits, individuals with knowledge of fraud against programs such as Medicaid, Social Security, SNAP, or HUD housing assistance are uniquely positioned to assist the government in recovering taxpayer funds and preserving the integrity of these essential programs. Those with relevant information should consult with a qualified whistleblower attorney to understand their rights and options before coming forward.
[1] Benefit Fraud: What You Need to Know About its Legal Definition, U.S. Legal, https://legal-resources.uslegalforms.com/b/benefit-fraud (last visited June 5, 2026).
[2] Id.
[3] See e.g., Fraud Prevention, U.S. Dep’t Vet. Affs., https://benefits.va.gov/BENEFITS/fraud-prevention.asp (detailing identity theft, phishing, and spoofing as risks to veterans and their beneficiaries).
[4] See e.g., Social Security Fraud Overview, Cong. Res. Serv., (Mar. 25, 2025) https://www.congress.gov/crs-product/IF12948.
[5] Government Benefits, USAgov, https://www.usa.gov/benefits (last visited June 5, 2026) (detailing common benefit programs).
[6] Id.
[7] Medicaid 101, Medicaid & CHIP Payment & Access Comm’n, https://www.macpac.gov/medicaid-101/ (last visited June 5, 2026).
[8] Supplemental Nutrition Assistance Program (SNAP), U.S. Dep’t Agric. https://www.fns.usda.gov/snap/supplemental-nutrition-assistance-program (last visited June 5, 2026).
[9] Temporary Assistance for Needy Families (TANF), Admin. Children & Families, https://acf.gov/ofa/programs/temporary-assistance-needy-families-tanf (last visited June 5, 2026)
[10] Government Benefits, USAgov, https://www.usa.gov/benefits (last visited June 5, 2026).
[11] Head Start Programs, HeadStart.gov, https://headstart.gov/programs/article/head-start-programs (last visited June 5, 2026).
[12] Fraud Detection: An Overview, Thomson Reuters, (Mar. 26, 2024) https://legal.thomsonreuters.com/blog/what-is-fraud-detection/#head-1
[13] Why Benefits Fraud is So Hard to Detect- and How to Tangible Improve Fraud Detection, Voyatek, https://www.voyatek.com/insights/why-benefits-fraud-is-so-hard-to-detect-and-how-to-tangibly-improve-fraud-detection/ (last visited June 5, 2026).
[14] Id.
[15] See e.g., Spending Explorer, USASpending.gov, https://www.usaspending.gov/explorer/budget_function (last visited June 5, 2026).
[16] Id.
[17] Id.
[18] Department of Veteran Affairs, Payment Accuracy, https://paymentaccuracy.gov/agency/VA (last visited June 5, 2026).
[19] Social Security Administration, Payment Accuracy, https://paymentaccuracy.gov/agency/SSA (last visited June 5, 2026).
[20] Department of Housing and Urban Development, Payment Accuracy, https://paymentaccuracy.gov/agency/HUD/2023 (last visited June 5, 2026).
[21] Press Release, U.S. Dep’t Just., Minnesota Health Care Fraud Takedown Results in Charges Against 15 Defendants for Over $90M in Fraud (May 21, 2026), https://www.justice.gov/opa/pr/minnesota-health-care-fraud-takedown-results-charges-against-15-defendants-over-90m-fraud.
[22] Press Release, U.S. Dep’t Just., Civil Division Moves to Fast-Track Benefits Fraud Enforcement (May 27, 2026). https://www.justice.gov/opa/pr/civil-division-moves-fast-track-benefits-fraud-enforcement.
[23] Id.
[24] Press Release, U.S. Dep’t Just., Mississippi Medicaid Recipients Agree to Pay Over $170,000 to Resolve False Claims Act Allegations of Health Care Benefits Fraud (Aug. 22, 2025), https://www.justice.gov/usao-sdms/pr/mississippi-medicaid-recipients-agree-pay-over-170000-resolve-false-claims-act.
[25] Press Release, U.S. Dep’t Just., DISH Wireless LLC to Pay More than $17M to Resolve False Claims Act and Administrative Allegations Related to FCC’s Broadband Benefits Programs (May 6, 2026), https://www.justice.gov/opa/pr/dish-wireless-llc-pay-more-17m-resolve-false-claims-act-and-administrative-allegations.
