The federal government’s financial response to the Covid-19 pandemic is measured in trillions of dollars, and the intensity of oversight related to that response reflects this unprecedented commitment. All involved in the government’s response, particularly financial services providers, should expect increased scrutiny of how those dollars have been and will be spent.
Buckley’s white collar, enforcement, congressional investigations, class actions, complex civil litigation, and False Claims Act & FIRREA teams are prepared to assist with government and congressional inquiries, examinations, investigations, and government and private party litigation that arise from the pandemic response. We work closely with our financial services regulatory practices to combine the firm’s core substantive experience with our deep knowledge of government investigations and litigation of all kinds.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act created both a Special Inspector General for Pandemic Response and a Pandemic Response Accountability Committee. The SIGPR and the PRAC join a host of existing inspectors general at federal agencies, including at the departments of Treasury, Housing and Urban Development, and Veterans Affairs, the Small Business Administration, and the prudential banking regulators that are devoting substantial resources to relief oversight. All of these agencies are also currently working with the Department of Justice to build both civil and criminal cases against institutions and individuals allegedly engaging in, or facilitating, waste, fraud, and abuse.
Other federal agencies with statutory authority in the existing federal and state consumer protection framework are also active in overseeing the government’s pandemic response. The Consumer Financial Protection Bureau has issued numerous information requests covering a host of financial products, and the Federal Trade Commission has opened investigations related to pandemic relief conduct. State attorneys general are monitoring complaint volumes and overseeing compliance with state laws and regulations enacted to supplement the federal response.
Congress, too, has established its role, as the CARES Act’s Congressional Oversight Commission joins Congress’s standing committees – along with any future select committees – to conduct investigations and hold hearings regarding pandemic relief efforts.
Financial institutions are facing class action and other litigation, in particular matters challenging their loan underwriting and origination under the Paycheck Protection Program. We anticipate further litigation regarding the various governmental efforts to address the pandemic, including potential civil False Claims Act and qui tam whistleblower actions.
We have gathered here relevant materials that describe civil and criminal oversight and relevant authority, inspectors general and how they operate, litigation issues, and congressional oversight initiatives.
- "CARES Act puts inspectors general back in the spotlight" by Daniel R. Alonso, Preston Burton, and Meredith Leeson (New York Law Journal)
- "5 FCA enforcement predictions after Coronavirus relief bill" by Andrew W. Schilling (Law360)
- "CARES congressional oversight: Scope and structure" by Preston Burton (Bloomberg Law)
- "CARES Act increases oversight and criminal investigations" by Daniel R. Alonso (Bloomberg Law)
- "SEC flexes regulatory and enforcement muscles in pandemic markets" by Thomas A. Sporkin and Timothy J. Coley (Buckley Commentary & Analysis)
- "Federal inspectors general and the pandemic response: What lenders and others need to know" (Buckley Webcast)
More than 70 inspectors general throughout federal agencies and other governmental entities have the power to issue subpoenas, coordinate with civil enforcement agencies, make referrals to and work with criminal prosecutors, issue public reports, and liaise with Congress. These investigations and potential enforcement actions can significantly strain resources, impede normal business activity, and cause reputational damage.
Buckley regularly guides clients through these inquiries and investigations, including those triggered by or involving whistleblowers, as well as handles the civil and criminal enforcement actions and congressional inquiries that arise from IG investigations.
Latin America as a region has long had a problem with public corruption, and the coronavirus pandemic has made things worse. As governments shovel public funds to fight the pandemic and its economic fallout, public officials are swindling millions, including in the graft-prone public health sector...Articles
One of the federal government’s most immediate responses to the coronavirus crisis was a highly visible campaign against profiteering. While the absence of an overarching federal anti-price gouging statute has forced prosecutors to improvise and legislators to contemplate new laws in order to...Buckley Commentary & Analysis
"Accurate FCRA reporting during Covid-19" by Marshall T. Bell, Jonathan D. Jerison, and Jessica L. Pollet (Bloomberg Law)
As financial institutions respond to a flurry of regulatory recommendations and mandates in response to the Covid-19 crisis, those relating to consumer reporting may be among the most difficult to decipher and operationalize. Federal and state authorities have made it clear that they expect...Articles
"CARES Act puts inspectors general back in the spotlight" by Daniel R. Alonso, Preston Burton, & Meredith Leeson (New York Law Journal)
Federal Inspectors General—the nation’s watchdogs over government agencies and government programs—are back in the news. First, the Coronavirus Aid, Relief, and Economic Security Act , received close attention not only for its $2 trillion infusion of taxpayer dollars into the U.S. economy, but also...Articles
"SEC flexes regulatory and enforcement muscles in pandemic markets" by Thomas A. Sporkin and Timothy J. Coley
The Securities and Exchange Commission is sticking to its three-fold mission of protecting investors, maintaining fair and orderly markets, and encouraging capital formation as it responds to the Covid-19 pandemic by issuing regulatory guidance on crisis-relevant market and capital issues,...Buckley Commentary & Analysis
The Coronavirus Aid, Relief, and Economic Security Act, signed in March 2020, enacted an unprecedented level of emergency government spending to provide public health relief and stabilize an economy damaged by the pandemic, and included oversight provisions to monitor how the $2 trillion is spent...Articles
The CARES Act will infuse more than $2 trillion into the U.S. economy — the largest such action in history. But if history is any guide, wherever there is a big pot of money, some people will look to steal it. Some desperate individuals might misrepresent their eligibility for unemployment benefits...Articles
On March 27, President Donald Trump signed into law the Coronavirus Aid, Relief and Economic Security Act, also known as the CARES Act. Although the False Claims Act is not mentioned in this stimulus bill, the implications of the act on FCA enforcement are likely to be significant. Click here to...Articles
Hank Asbill was extensively quoted on July 10, 2020 in an Agenda article, “New wild cards for white-collar enforcement,” which discussed the state of white collar enforcement amid the Covid-19 pandemic. Asbill noted, “Covid-19 has made it exponentially more difficult to conduct criminal trials. The...In The News
Preston Burton quoted in American Banker article, “Will Congress's coronavirus response watchdog have any teeth?”
Preston Burton was quoted on April 22, 2020 in an American Banker article, “Will Congress's coronavirus response watchdog have any teeth?” which discussed the Congressional Oversight Commission and the areas the panel will lack enforcement authority. Burton noted, “The panel lacks subpoena...In The News
Daniel R. Alonso was quoted on March 17, 2020 in a Wall Street Journal article, “Coronavirus disrupts U.S. court system,” which discussed decisions across the country to delay trials and limit public access to courthouses, including no new empaneling of grand juries in New York specifically. Alonso...In The News