S. 3652 — Welfare Fraud Deterrence and Recovery Act of 2026

This section establishes enhanced criminal penalties for violations of the false statements statute (18 U.S.C. 1001(a)) relating to a Federal welfare program (as defined in section 4 of the Welfare Fraud Deterrence and Recovery Act of 2026). The amendments (1) increase the maximum term of imprisonment to 15 years (from 5 years generally or 8 years for terrorism-related offenses or matters involving specified sex crimes); (2) impose a minimum two-year term of imprisonment if the defendant is a noncitizen or naturalized U.S. citizen (as defined therein); and (3) impose a minimum five-year term if the defendant obtained $100,000 or more as a result of the violation.

This section amends the Immigration and Nationality Act to establish immigration consequences for certain fraud convictions, as follows: (1) requires immediate denaturalization of any naturalized U.S. citizen convicted of welfare fraud (i.e., defrauding the federal government of a federal public benefit as defined in 8 U.S.C. 1611(c), or a state or local government of a state or local public benefit as defined in 8 U.S.C. 1621(c)) if the underlying acts began after naturalization; (2) renders inadmissible for 20 years any alien denaturalized under this provision who seeks readmission; (3) renders deportable any alien convicted of an offense under 18 U.S.C. chapter 47 (fraud and false statements) or any fraud offense in a U.S. court; and (4) expands expedited removal to any noncitizen convicted of an aggravated felony or these deportable fraud offenses (with conforming changes to the relevant statutory header and procedures).

This section establishes within the Department of Justice, in consultation with the Secretary of Health and Human Services, a Welfare Fraud Recovery Task Force to investigate, prosecute, and recover funds lost to fraud in federal welfare programs (i.e., programs providing federal public benefits under the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, including grants under the Child Care and Development Block Grant Act of 1990 and the Child and Adult Care Food Program). The section authorizes the task force to bring civil actions against persons who knowingly submit false claims, use false records or statements, conspire to defraud, or conceal obligations under such programs. Violators are liable for a civil penalty of $10,000-$20,000 (inflation-adjusted under the Federal Civil Penalties Inflation Adjustment Act of 1990), treble damages, and costs including attorney fees; noncitizens face enhanced penalties of double damages plus interest under 31 U.S.C. 3717. Actions must be brought within the later of 15 years after the violation or 3 years after official discovery, with proof by a preponderance of the evidence; whistleblowers receive protections under 31 U.S.C. 3730(h) and rewards of 15-30% of recoveries. The section creates the Welfare Fraud Recovery Fund in the Treasury, into which recoveries are deposited and remain available until expended without further appropriation to HHS for reimbursing fraud losses in federal welfare programs and funding task force investigations and prevention. The section directs the task force to facilitate interstate cooperation on cross-border welfare fraud schemes, including information sharing (subject to the Privacy Act), joint investigations, and subpoenas, with states eligible for up to 20% of recoveries based on cooperation; states receiving federal welfare funds must comply with task force requests for information or assistance.