FinCEN Convenes Banks and Law Enforcement on Hospice Fraud and Money Laundering Risks
The U.S. Financial Crimes Enforcement Network (FinCEN) convened law enforcement agencies and financial institutions in Los Angeles on 17 August 2026 to examine fraud involving government health care benefit programs, with particular attention to the exploitation of hospice services.
According to FinCEN’s 19 August readout, participants discussed new and emerging schemes targeting federal and state health insurance programs, the financial typologies associated with those schemes, red flag indicators and ways to improve awareness of hospice care fraud. FinCEN also held a separate training session for law enforcement on 18 August on the use of Bank Secrecy Act (BSA) data in fraud investigations.
Health care fraud increasingly linked to organised crime
FinCEN said fraud involving Medicare and Medicaid continues to increase in scale and complexity and is increasingly connected to domestic fraud networks and transnational criminal organisations. The engagement builds on FinCEN’s March 2026 advisory on health care fraud, issued with the FBI and the U.S. Department of Health and Human Services Office of Inspector General.
That advisory showed the scale of the reporting trend. FinCEN recorded a 330% increase in BSA reporting related to health care fraud between 2020 and 2025. In 2025 alone, financial institutions filed more than 3,800 initial Suspicious Activity Reports that selected the health care or health insurance category, although FinCEN said this likely captures only a fraction of the underlying illicit activity.
How fraudulent reimbursements are laundered
FinCEN’s advisory describes schemes in which criminals use straw owners, stolen identities and shell companies to register health care providers or suppliers and open bank accounts that appear to belong to legitimate businesses. False claims may involve services that were never provided, medically unnecessary treatment, double billing, unbundling or upcoding.
Once fraudulent reimbursements are paid, the proceeds may be moved through domestic or international wire transfers, shell-company accounts, virtual asset service providers, unhosted crypto wallets, broker-dealers, online betting platforms and money mule accounts. FinCEN also identifies cash withdrawals, money services businesses and purchases of real estate, luxury goods and other high-value assets as potential laundering channels.
The March advisory asks financial institutions filing relevant SARs to use the key term HCF-2026-A001 and, where applicable, the health care/public or private health insurance SAR category. FinCEN also encourages institutions to notify law enforcement promptly when they identify schemes targeting government health care programs.
The Los Angeles engagement is part of the FinCEN Exchange programme, a voluntary public-private partnership created to improve information sharing between financial institutions and law enforcement on high-impact money laundering and related financial-crime threats.
