S. 3652: Welfare Fraud Deterrence and Recovery Act of 2026

This bill, known as the Welfare Fraud Deterrence and Recovery Act of 2026, aims to strengthen measures against welfare fraud through various legal and administrative changes. Below is a summary of its key provisions organized into sections:

Enhanced Criminal Penalties for Welfare Fraud

The bill proposes to increase the penalties for individuals convicted of committing welfare fraud with respect to federal programs. Key points include:

• A maximum imprisonment of 15 years for welfare fraud.
• A minimum sentence of 2 years for noncitizens or naturalized U.S. citizens convicted of the same crime.
• A minimum of 5 years if the fraud results in the individual receiving at least $100,000.

Immigration Consequences for Fraud Conviction

The bill introduces specific immigration consequences for those convicted of welfare fraud:

• Former naturalized citizens who are denaturalized for welfare fraud cannot re-enter the U.S. for 20 years.
• Individuals convicted of fraud can be deported.
• Noncitizens face expedited removal from the U.S. for felony convictions involving fraud.
• Denaturalization may occur for those convicted of defrauding federal or state welfare programs.

Welfare Fraud Recovery Task Force

The bill establishes a task force within the Department of Justice aimed at investigating and recovering funds lost to welfare fraud. It includes the following provisions:

• The task force will collaborate with the Secretary of Health and Human Services.
• It will be authorized to bring civil actions against individuals submitting false claims or engaging in fraud.
• The task force will have the authority to impose significant financial penalties for such violations.

Civil Actions for Welfare Fraud

The task force is empowered to initiate civil lawsuits against individuals for various forms of welfare fraud, which include:

• Filing false claims.
• Using deceptive records relevant to claims under federal welfare programs.
• Conspiring to commit fraud.
• Knowingly concealing or reducing obligations to pay the government.

Damages may include civil penalties ranging from $10,000 to $20,000, triple the amount of damages incurred, and the covering of legal costs.

Recovery of Damages

All funds recovered through civil actions will be deposited into a special fund established to reimburse welfare programs for losses caused by fraud and for ongoing investigations and prevention programs.

Interstate and Cross-Border Cooperation

The task force will facilitate cooperation among states and engage in investigations that cross state and national borders. This includes sharing information such as beneficiary records and financial data while adhering to privacy laws. They may also pursue cooperation with foreign jurisdictions to recover assets related to welfare fraud.

Reporting and Accountability

The bill includes provisions for annual reporting to Congress on investigations conducted by the task force, detailing the efforts made in recovering fraudulent funds.

Whistleblower Protections

Individuals who provide information leading to successful recoveries are offered protections and rewards, ensuring they can report fraud without fear of retaliation.

Use of Recovered Funds

Recovered funds will be used to reimburse welfare programs for fraud losses and support the cost of investigations and preventive efforts undertaken by the task force.

Relevant Companies

None found.