The FBI is investigating at least 15 nonprofit organizations in the Minneapolis-St. Paul area for what it calls a “massive fraud scheme” to siphon off millions of government dollars meant to feed needy children.
Investigators from the FBI and other agencies raided 15 homes and offices in the Twin Cities after obtaining search warrants. In affidavits obtained by the New York Times, the FBI said that those organizations received $65 million in federal food program payments during the pandemic and “almost none of this money was used to feed children. Instead, conspirators misappropriated the money and used it to purchase real estate, cars, and other items.”
No charges have been filed, and the organizations deny wrongdoing. But critics point out that the investigation demonstrates the weaknesses and vulnerability to fraud in a system where the government relies on nonprofits to carry out programs.
The U.S. Department of Agriculture oversees more than $20 billion of spending on meals for children annually, and oversight has long been sloppy. After the pandemic struck in March 2020, the oversight grew ever laxer when USDA waived rules requiring on-site monitoring. Providers could be reimbursed for meals without having to show proof that children received the food.
Meanwhile, evidence of pandemic fraud in nonprofits that the government entrusts with funneling federal dollars has caught the attention of President Biden. During his March 1 State of the Union address, Biden announced that the Justice Department will be appointing a chief prosecutor to focus on the “most egregious” forms of pandemic fraud.
Auto Braking System Lawsuit May Proceed
The Arizona Supreme Court ruled that an auto manufacturer can be sued for failing to include an emergency braking system in its vehicles when it is available.
The ruling allows the family of a girl who was killed in a collision, which they contend could have been prevented by the braking technology, to proceed with their lawsuit. The accident occurred when driver Melissa Varela prepared to take a freeway exit in North Phoenix but was blocked by an emergency vehicle. The driver of a Jeep Grand Cherokee SUV slammed into the rear of her Lexus sedan, killing 4-year-old Vivian Varela, who was riding in the back seat, and injuring her mother.
The Varelas sued Jeep’s parent company, Fiat Chrysler, arguing that emergency braking devices that were then an optional safety feature should have been included in all vehicles.
Fiat Chrysler’s lawyers argued that emergency braking, while promising, is still new and doesn’t guarantee that collisions can be avoided.
The case, which now goes back to a trial court, is being closely watched by the auto industry.
Restaurants Sue Google Over Food Ordering Pages
A Florida restaurant group is accusing Google of engaging in chicanery by setting up unauthorized pages to capture food orders rather than the restaurants’ own sites.
The group filed a lawsuit claiming that Google uses “bait-and-switch” tactics to get customers to place takeout or pickup orders through deceptive webpages.
The suit, filed in federal court in San Francisco, alleges that Google is setting up the pages to take a cut of fees from delivery orders like DoorDash and Grubhub.
Google denies the charges.
McDonald’s Soft-Serve Whips Up a Legal Battle
Regular customers at McDonald’s understand the restaurants have long been plagued by a strange problem with their soft-serve ice-cream machines. Too often, they just don’t work.
Then along came two friends from California who came up with an app that allowed restaurant owners to fix the machines without having to hire a technician. Their company, Kytch, sold the program to hundreds of franchisees.
Then, however, McDonald’s sent out warnings to the franchisees, saying that the technology could lead to worker injuries. The two Kytch friends looked further into the matter and now allege in a lawsuit that McDonald’s is libeling them at the same time that they’re working with the Taylor Company, which makes its ice-cream machines, to copy the Kytch technology.
The lawsuit, which McDonald’s says is “meritless,” seeks $900 million in damages.
We are confident that the legal system will straighten this all out. Meanwhile, though, if you are craving a McDonald’s soft-serve but are not sure whether to waste time in the quest, help has arisen.
It’s a website called McBroken, and it provides a map of the places you should currently avoid. Seriously.