FinCEN Issues Advisory to Financial Sector Enhancing Obligations with Respect to Policing Health Care Fraud Schemes

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On March 30, 2026, as part of the Trump Administration’s commitment to rooting out fraud against the government, the United States Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) issued an advisory “to urge financial institutions to be vigilant in identifying and reporting suspicious transactions potentially related to health care fraud schemes targeting Medicare, Medicaid, and other Federal and state health care benefit programs.” This advisory applies to a broad range of those in the financial sector including banks, broker dealers, investment companies, insurance companies, certain real estate businesses, and more. FinCEN also proposed new rulemaking for its whistleblower program, which appears to be aimed at financial institutions who do not adequately detect and report fraud. While this advisory appears aimed at combatting overt healthcare fraud, it will likely have an impact on a wide variety of healthcare and financial services businesses who are not involved in such fraud. In response, financial institutions and healthcare companies should consider reviewing and modifying their compliance policies and procedures to meet these enhanced expectations.   

Highlights of the FinCEN Advisory:   

• The FinCEN advisory provides financial institutions with an overview of common health care fraud schemes targeting Health Care Benefit Programs, including: 
  • The use of straw owners and shell companies; 
  • The filing of false and fraudulent claims for non-existent, exploitative, substandard, or unnecessary medical care; and 
  • The obfuscation of fraudulent reimbursements through the U.S. and international financial systems. 
• The advisory also highlights associated money laundering concerns and lists 24 red flag indicators to identify and report suspicious activity to FinCEN. 
  • Some examples of red flags include: 
    • Customers opening accounts for health care businesses when the customer, or their beneficial owners, have prior health care fraud or government benefits fraud convictions;  
    • Customers starting accounts for health care businesses when their owners are not legal permanent residents of the United States or have no significant prior experience in the healthcare industry;  
    • Transfers of a significant amount of reimbursements to recently established shell companies; 
    • A health care provider receives significant reimbursements soon after opening or soon after a change in beneficial ownership; and  
    • Any sudden significant increase in reimbursements.  
• FinCEN reiterates financial institutions’ reporting requirements under the Bank Secrecy Act (“BSA”). 
• FinCEN strongly encourages financial institutions to voluntarily report suspicious activity related to fraud. 
• Finally, FinCEN strongly encourages immediate notification to law enforcement regarding fraud schemes targeting Health Care Benefit Programs.  

Impacts on Financial Institutions and Healthcare Providers:   

• The advisory appears to place enhanced expectations on financial services companies associated with their anti-money laundering (“AML”) programs and monitoring of healthcare fraud specifically. Companies may be obligated to dig much deeper into the ownership and transactions of healthcare companies than they previously thought. 

• This could also increase the burden on new healthcare providers setting up financial accounts as financial institutions may be asking questions about their ownership and business model that they have never asked before. 

• There is an increased chance of healthcare companies having their accounts closed, or being “derisked”, by banks and others for unusual business models. 

• This will also likely increase the diligence cost on transactions in the healthcare and financial services spaces, including in financial technology.  

• There is an increased risk of governmental investigations into healthcare companies, and potentially into financial institutions for failure to properly detect and report suspicious activity (regardless of whether the underlying allegations have merit).  

• There will also likely be increased costs associated with subpoenas and other investigative matters for both financial services companies and healthcare companies. 

• Finally, the proposed whistleblower program will increase the volume of whistleblower reports against financial services clients and healthcare clients. This means that employers will need to encourage internal reporting and investigation. Employers may also need to be more cautious about how they handle terminations and other employment actions lest they be accused of retaliation.    

How can Maynard Nexsen Help You Respond to the Advisory?   

Maynard Nexsen has teams dedicated to the financial services industry and the healthcare sector, and a team experienced in compliance program design, conducting internal investigations, managing whistleblowers, and responding to external inquiries by FinCEN and other government regulators and enforcers. Maynard Nexsen can advise financial services clients on FinCEN’s expectations for their AML compliance programs and on how to respond should FinCEN or anyone else question their efforts. Finally, Maynard Nexsen can advise healthcare businesses on how to minimize derisking and how to handle financial services or other investigations.