DOJ Fights Coronavirus Fraud
U.S. Attorney Jason Dunn says awareness, skepticism are best defense as new scams proliferate by the day

by Jessica Folker

The coronavirus outbreak hasn’t just put the health of the global population at risk, it has created new opportunities for scammers to take advantage of unwitting victims as well. But federal and state agencies are working to fight fraudsters who prey on COVID-19 fears.

U.S. Attorney for Colorado Jason Dunn on March 21 announced his office will prioritize the investigation and prosecution of fraud related to the pandemic as part of a nationwide effort by the Department of Justice to crack down on emerging scams.

One of the most prevalent schemes so far has involved websites or emails claiming to offer coronavirus vaccines, cures or test kits, Dunn said. On March 21, the DOJ filed a civil complaint in Texas against a website claiming it would ship vaccine kits from the World Health Organization, although there is no COVID-19 vaccine available. A federal judge in Austin issued a temporary restraining order to block public access to the website. Days later, a California man was charged with attempted wire fraud in federal court for trying to solicit investment for a “patent-pending” cure for COVID-19.

The Federal Trade Commission and U.S. Food and Drug Administration have also gotten involved. Earlier in March, the agencies sent their first round of warning letters to companies selling teas, essential oils and other false “cures.” Televangelist Jim Bakker was among the first to be slapped with a warning for marketing a “silver solution” as a COVID-19 treatment, and he has since been sued by the state of Missouri over the fake cure.

The next wave of scams is likely to center around the federal stimulus package, according to Dunn. “When we start to see the government actually sending out checks to people, I think you will see scams come fast and furious around that because it’s an opportunity to get money,” he said. Although checks from the government won’t arrive for weeks, phishing scams promising stimulus money are here already, according to media reports and warnings issued by the Census Bureau, FBI and Better Business Bureau, among others.

While he isn’t aware of any scams that target businesses, specifically, Dunn said companies should watch out for email fraudsters who solicit money or sensitive information by mimicking messages sent from trusted colleagues.

In other words, a CFO should double check before wiring a big sum of money based on an email from the company president. That’s a sensible practice even when there’s not a pandemic, but attorneys should advise business clients to be extra vigilant and always question whether requests for payment or attachments are legitimate, according to Dunn.

Other scams the DOJ and Colorado Attorney General’s Office have warned about in recent weeks include phishing emails posing as the WHO or Centers for Disease Control and Prevention, ransomware websites or apps touting virus-related information, donation schemes for fake charities and overcharging for medical tests and procedures.

According to news reports, scammers are even exploiting those of us who are spending more time on the couch by advertising fake Netflix deals as part of a phishing scheme.

Dunn said his office is working closely with the Colorado Attorney General’s Office and local authorities as well as federal agency partners ranging from the FDA to the U.S. Postal Inspection Service.

“One of the good things is that we have [in Colorado] what I consider the gold standard of federal, state and local partnerships in the country,” he said.

Dunn has appointed Executive U.S. Attorney J. Chris Larson as the office’s coronavirus fraud coordinator, a role that involves serving as liaison to federal agencies and courts as well as state and local governments.

Larson will conduct outreach and awareness activities, including working with local law enforcement so they know what types of fraud to watch for and warn residents about. Social media advertisements and news coverage will also be a part of the publicity push. “As I’ve always said, for any type of fraud and scams against consumers, the best defense is not law enforcement or prosecutors. It’s the people themselves,” Dunn said, adding that if it sounds too good to be true, it probably is.

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