Attorney General Bonta Denounces Trump Administration’s Political Weaponization of Fraud

California DOJ's ongoing work to tackle fraud led to recovery of nearly $2.7 billion for California taxpayers

LOS ANGELES - California Attorney General Rob Bonta today emphasized the ongoing work of the California Department of Justice (California DOJ) to tackle fraud in the state and pushed back against the Trump Administration's characterization that California programs are overrun by fraud and that state government is somehow facilitating this fraud. This is categorically false. While the issue of fraud seems conveniently novel to the Trump Administration, California has been aggressively tackling fraud head-on and has recovered nearly $2.7 billion for California taxpayers, including by partnering with the federal government. Fraud is not unique to California; bad actors will look for opportunities to pocket cash - including in states like Florida, Texas, and Ohio.

"The Trump Administration is attempting to take the issue of fraud - a very real, and national issue - and weaponize it against Democratic states. Trump and his cronies are alleging that the government of California is somehow in on the fraud. This lie is aimed at sowing distrust and conjuring up a reason to go after states he sees as enemies. We've seen this playbook from the President before, it's reckless and dangerous," said Attorney General Bonta. "California has been aggressively tackling this challenge head-on for decades - including by partnering with the federal government on occasion. Just like Florida and Texas, our public programs are at times taken advantage of by bad actors. When that happens, a real watchdog doesn't blame the victim, it zeros in on the perpetrators and goes after them. California is a leader in tackling fraud on state programs and the numbers prove it: My office has recovered nearly $2.7 billion in the last 10 years. We welcome the productive collaboration of the federal government, just as we have time and time again - but let me be clear, we will absolutely denounce all attacks and stand up to these ridiculous lies."

By the Numbers:

In the past 10 years, through criminal and civil prosecutions California DOJ has recovered nearly $2.7 billion in fraud against California. This includes:

• Nearly $2 billion recovered under California's False Claims Act
• Nearly $740 million in Medi-Cal fraud-related criminal prosecutions
• Over $108 million recovered by DOJ's Tax Recovery in Underground Economy (TRUE) task force

California DOJ has:

• Conducted 2,490 criminal investigations
• Filed criminal charges against 958 individuals with fraud-related offenses
• Conducted 1,121 civil investigations with multiple filed cases

DOJ's Division of Medi-Cal Fraud and Elder Abuse

The Division of Medi-Cal Fraud and Elder Abuse (DMFEA) works to investigate and prosecute those who would defraud taxpayers of millions of dollars and divert scarce healthcare resources from the poor. DMFEA also works diligently to protect residents in nursing homes and other long-term care facilities from abuse or neglect. These dedicated efforts have earned national recognition for the DMFEA. Last summer, Attorney General Bonta launched an initiative aimed at educating the public and providing vital reporting resources to individuals and families who may have been impacted by hospice fraud. Its goal is to ensure that individuals and families understand their rights, recognize red flags in hospice care, and know where and how to report if they suspect fraudulent activity. DMFEA has recovered nearly $740 million in Medi-Cal fraud related criminal prosecutions, including by:

• Announcing the sentencing of Inland Empire Hospice operators, Ralph and Rochell Canales, for submitting false claims to the Medicare and Medi-Cal programs. Ralph Canales was sentenced by the San Bernardino County Court to seven years and four months in state prison and was jointly ordered to pay $1,455,233, alongside his wife Rochell Canales.
• Going after eight individuals for defrauding Medi-Cal for nearly $60 million while operating three home health agencies in Southern California. They were indicted on 23 felony charges, including Medi-Cal fraud, insurance fraud, grand theft, and money laundering.

The Corporate Fraud Section and False Claims Unit

The Attorney General's Corporate Fraud Section (CFS) investigates fraud and other financial wrongdoing perpetrated against the state. Hardworking taxpayers pay into their state and local funds to protect critical public and social infrastructure like schools, healthcare, and our streets and roads. When individuals - and most often, powerful companies - cheat our government, these taxpayers are also cheated. The California's False Claims Act is a powerful tool to reveal, deter, and hold people accountable who defraud the government - cases brought under this law have recovered billions of dollars. In the last 10 years, California DOJ has deployed 1,121 investigations and recovered nearly $2 billion under this law, including by:

• Securing a $102 million settlement with BP Energy over allegations that it intentionally overcharged California for natural gas that the state purchased between 2003 and 2012.
• Recovering $150 million from Morgan Stanley resolving claims the company misled investors - including California's teachers and public employees.
• Securing a $241 million settlement with Quest Diagnostics, resolving claims the company illegally overcharged the state's Medi-Cal program for the poor.

Last year, Attorney General Bonta sponsored legislation that would have updated California's False Claims Act to more effectively fight tax fraud that harms California communities. SB 799 would have made it easier to find and go after tax cheats who aren't paying their fair share.

The Tax Recovery in Underground Economy (TRUE) Task Force

Under California DOJ's Division of Criminal Law, the TRUE task force was created to ensure multi-agency collaboration and to combat wage theft, tax evasion, and other crimes in the underground economy. The task force consists of attorneys, investigators, and special agents from the Department of Justice, the Department of Tax and Fee Administration, the Franchise Tax Board, and the Employment Development Department. In the last 10 years, its investigative teams have opened 120 investigations, resolved 64 felony cases, and recovered over $108 million, including by:

• Securing a prison sentence and restitution from a Los Angeles tobacco distributor, who pled guilty to running a $3 million tax evasion scheme against the State of California.
• Announcing the takedown of a Long Beach Crip street gang that operated an identity theft scheme to perpetrate tax fraud, stealing over $3.3 million and attempting to steal over $11 million via tax fraud.

Resources:

To report suspected Medi-Cal fraud:

• Submit a Complaint Online at https://oag.ca.gov/dmfea/reporting
• Call the Attorney General's Division of Medi-Cal Fraud & Elder Abuse Complaint Line Toll-free at: (800) 722-0432
• Send a Written Complaint by Mail:
  California Department of Justice
  Division of Medi-Cal Fraud and Elder Abuse
  P.O. Box 944255
  Sacramento, CA 94244-2550

For more information on hospice fraud please see our consumer alert. Please see here for a brochure in English and one in Spanish.

To report false claims against the state:

Members of the public who would like to advise the Attorney General of a potential false claim against the state should contact the Attorney General's Public Inquiry Unit.

If someone knows that state or local government is being cheated, they can file a lawsuit confidentially (under seal) based on the California False Claims Act. Whistleblowers get a share of any recovery.

The Division of Medi-Cal Fraud and Elder Abuse receives 75% of its funding from the U.S. Department of Health and Human Services under a grant award totaling $77,652,892 for Federal Fiscal Year (FFY) 2026. The remaining 25%, totaling $25,884,297 for FFY 2026, is funded by the California Attorney General's Office. FFY 2026 is from October 1, 2025, through September 30, 2026.