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The Kleptocracy Asset Recovery Rewards Act
( KARRA ) authorizes a U.S. Treasury Department
( Treasury ) pilot program aimed at rewarding
whistleblowers who provide information leading to the restraint,
seizure, forfeiture, or repatriation of assets held in U.S.
financial institution accounts that are derived from foreign
government corruption.
On January 1, 2021, the Senate joined the House of
Representatives in overriding the president s veto of the
National Defense Authorization Act, which provides for KARRA. KARRA
creates a three-year whistleblower program aimed at detaining stolen assets -that is, funds traceable to foreign
Background
The Financial Crimes Enforcement Network (FinCEN) of the U.S.
Department of Treasury sounded the alarms recently with its
advisory (FIN-2021-A001) urging financial institutions
to remain vigilant and, as necessary, allocate enhanced compliance
resources to deter and detect COVID-19-related schemes connected to
healthcare entities, health insurance, health benefit programs, and
pandemic relief funds.
Since the public health emergency declaration of January 31,
2020, by the U.S. Department of Health and Human Services, U.S. law
enforcement and regulatory agencies have identified numerous
instances of fraud involving the exploitation by individuals and
companies of Medicare, Medicaid, TRICARE, and other healthcare
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In January 2021, the U.S. District Court for the Southern
District of New York considered a motion to dismiss a class action
lawsuit filed against Helbiz, Inc. and other defendants that
concerned Helbiz s issuance of HelbizCoin, a
cryptocurrency.
1 The suit included claims arising under
United States securities laws. The Court granted the motion because
it held the cryptocurrency purchases did not occur in the United
States, despite computing activity occurring in the United States
that made the purchases possible.
Helbiz allegedly promoted the purchase of HelbizCoin as the
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The March 2020 Coronavirus Aid, Relief, and Economic Security
Act ( CARES Act ) created enormous incentives for
companies to apply for economic stimulus funding and grants to
alleviate the devastating economic impacts from the worldwide
pandemic. Until recently, the U.S. Department of Justice
( DOJ ) focused mainly on filing criminal actions against
individuals who allegedly committed fraud and made false statements
in connection with CARES Act stimulus funds, in particular criminal
fraud cases involving the Small Business Administration Paycheck
Protection Program ( PPP ). But a recent PPP enforcement