Fraud exists when:

· A family has willfully or intentionally withheld, concealed, or misrepresented information to receive or to attempt to receive more benefits than they are eligible to receive or to help another person to receive or to attempt to receive more benefits than the person is entitled to receive.

· A provider has willfully or intentionally withheld, concealed, or misrepresented information to be authorized by CCAP; to receive or to attempt to receive payments to which the provider was not entitled; or to help another person to receive child care assistance to which that person is not entitled. For administrative disqualifications against a provider, intent may be proven by showing a pattern of conduct that violates CCAP policies.

Family fraud referrals

Refer families you suspect of fraud for investigation.

For CCAP agencies participating in the Fraud Prevention Investigation (FPI) program, use the Fraud Prevention Investigation Referral form DHS-3335A (PDF) to make a referral for an FPI.

For CCAP agencies not participating in the FPI program, follow your agency’s process to make a referral for possible family fraud investigation and use the Fraud Prevention Investigation Referral DHS-3335A (PDF) form to notify the Office of Inspector General (OIG) of the investigation. Agency processes for making referrals may include contacting your agency’s fraud investigator or investigative unit, your county or Tribal attorney, and/or your local sheriff’s department.

Family fraud referrals should be made whenever case file information exhibits characteristics of possible misinterpretation or omission of relevant facts or when there is inconsistent information that impacts eligibility, to determine if fraud may have occurred.

These situations may occur at the time of application, redetermination, a change report, when case file information is updated or reviewed for accuracy, or when your agency receives a report of potential fraud.

Provider fraud referrals

Refer or notify the Office of Inspector General (OIG) Child Care Audits and Investigations Unit of providers you have program integrity concerns about, such as concerns about record keeping practices and/or providers you suspect of fraud. Some CCAP agencies may have the resources to investigate provider fraud locally. However, CCAP agencies must communicate with the OIG prior to opening a provider investigation, and they are encouraged to use the Child Care Provider Investigations Communications DHS-6811 (PDF) form to inform the OIG of all child care provider investigations.

Send referrals or notifications whenever it appears a provider is withholding, concealing, or misrepresenting information in order to:

· Become a registered provider;

· Receive payments for which the provider is not entitled; and/or

· Resolve current registration or payment issues, including possible fraud.

These situations could occur at registration, renewal, billing, when information is updated or reviewed for accuracy, or when the CCAP agency receives a report of potential fraud.

Continuation of benefits

During a fraud investigation:

· Continue family benefits if current eligibility exists. Do not close a case or deny benefits to a family under investigation for fraud if they are otherwise eligible, unless another reason exists to close or deny the family’s benefits

· A provider’s registration cannot be closed or denied and payments must continue to authorize providers, unless state staff:

· Use specific authority to temporarily immediately stop or suspend a provider’s payments while an investigation or disqualification is pending.

· Establish another reason to close or deny the provider’s registration.

Disqualification process and fraud consequences

CCAP agencies handle:

· Fraud disqualifications for families, which involves disqualifying parentally responsible individuals (PRI) who have wrongfully obtained assistance or committed an Intentional Program Violation (IPV).

· Provider disqualifications through the courts that are initiated by their County and Tribal Attorney, such as criminal prosecution or a disqualification consent agreement.

The Office of Inspector General (OIG) Child Care Audits and Investigations Unit handles all administrative disqualifications for child care providers.

For information about the disqualification process and consequences for fraud, see:

· Chapter 13.6 (Disqualification for Wrongfully Obtaining Assistance – Families),

· Chapter 13.9 (Disqualification for Wrongfully Obtaining Assistance – Providers),

· Chapter 13.6.3 (Administrative Disqualification - Families),

· Chapter 13.6.6 (Entering Disqualification Periods in MEC2 – Families),

· Chapter 13.9.3 (Administrative Disqualification – Providers), and

· Chapter 13.9.6 (Entering Disqualification Periods in MEC2 – Providers).

Notification of overpayments

If the fraud investigator or County or Tribal Attorney believes that claims activity may hinder an investigation, CCAP workers must delay notifying the family or provider of an initial overpayment until fraud has been determined or the case has been closed.

CCAP agencies and/or the OIG are required to start recovery or recoupment by the last day of the calendar quarter that includes the discovery date of the claim. See DISCOVERY DATE in Chapter 2 (Glossary). An investigation may identify additional information about the overpayment, so the discovery date is unknown until fraud has been determined and/or the case is closed.

Establishing overpayments for fraud

CCAP agencies and/or the OIG cannot establish an overpayment for fraud before fraud is determined. For information about how fraud is determined, see Chapter 13.6 (Disqualification for Wrongfully Obtaining Assistance – Families) and Chapter 13.9 (Disqualification for Wrongfully Obtaining Assistance – Providers).

Overpayments can be established for reasons other than fraud before fraud is determined. If fraud is later determined, update the overpayment reason to fraud to ensure that the correct amount is recouped. See Chapter 14.9.6 (Recoupment - Families) and Chapter 14.9.9 (Recoupment - Providers).

Legal authority

Minnesota Statutes 142A.25
Minnesota Statutes 142A.26
Minnesota Statutes 142A.27
Minnesota Statutes 142E.17
Minnesota Statutes 142E.18
Minnesota Statutes 142E.16
Minnesota Statutes 142E.51, subd. 5
Minnesota Statutes 256.98
Minnesota Statutes 256.983, subd. 5
Minnesota Rules 3400.0183