Money & Finance › Fraud, scams & enforcement › Securities fraud: lying to investors and rigging markets
Fraud enforcers: DOJ, FBI and the FTC
FBI 1908; FTC 1914· Institution or agency
Fact, law or dataA rule, statute, definition or measured number.
The main federal fraud fighters: the Justice Department prosecutes, the FBI investigates, and the FTC protects consumers through civil cases.
See it on the Money & Finance map →How it works
The Justice Department, created in 1870, prosecutes through 94 US attorney offices; Manhattan's Southern District leads on Wall Street cases. The FBI, founded in 1908 as the Bureau of Investigation, handles major fraud and runs the Internet Crime Complaint Center. The Federal Trade Commission (1914) sues deceptive businesses, collects consumer fraud reports and seeks refunds. Prosecutors charge mail fraud (an 1872 law), wire, securities, bank and health-care fraud, working with Postal Inspectors, the Secret Service and IRS criminal investigators.
Why it matters
Civil regulators like the SEC can only fine and ban; the threat of prison comes from these agencies, and their priorities decide which frauds get pursued.
Facts, rules and data
DOJ press releases and court records; FBI Internet Crime Reports; FTC Consumer Sentinel data; recoveries under the False Claims Act, about $2.9 billion in fiscal 2024.
Debates and risks
How well enforcement deters fraud is debated; a 2021 Supreme Court ruling (AMG Capital) curbed the FTC's power to win refunds without longer proceedings.
Inside this (2)
Connections (5)
▸Securities and Exchange Commission (SEC) refers criminal cases to Fraud enforcers: DOJ, FBI and the FTCFact, law or data
The connection
The SEC can bring only civil cases, so when evidence points to willful fraud it refers the matter to the Justice Department, usually a US attorney's office, and the FBI. The agencies often file the same day: the SEC seeks fines and asset freezes, while prosecutors bring criminal charges that carry prison.
When and why
Routine since the 1930s; Madoff was arrested by the FBI and sued by the SEC on December 11, 2008, and FTX's founder was charged by DOJ, SEC and CFTC on December 13, 2022.
How we know
Parallel complaints and indictments filed together in public court records; SEC rules allow sharing its investigative files with prosecutors on request.
Debates and risks
Defense lawyers argue civil investigations can unfairly gather evidence for criminal cases; how often smaller frauds should be referred is debated.
▸CMS: the Medicare and Medicaid agency refers Medicare fraud to Fraud enforcers: DOJ, FBI and the FTCFact, law or data
The connection
CMS uses data analytics to flag suspicious billing, suspends payments, revokes providers and refers cases to the HHS inspector general, which investigates with the FBI. Justice Department strike forces prosecute, and the False Claims Act lets whistleblowers sue for a share of recovered money. Common schemes: billing for services never given, kickbacks and phantom equipment.
When and why
Nationwide; the Medicare Fraud Strike Force began in Miami in 2007. A June 2025 takedown charged 324 defendants over about $14.6 billion in alleged fraud, the largest ever.
How we know
DOJ and HHS inspector general announcements; CMS improper-payment reports; False Claims Act recoveries, which come mostly from health care.
Debates and risks
How much Medicare and Medicaid money is lost to fraud is unknown; improper-payment figures, tens of billions a year, mix fraud with paperwork errors.
▸FTX and Sam Bankman-Fried (2022) was prosecuted by Fraud enforcers: DOJ, FBI and the FTCFact, law or data
The connection
Federal prosecutors in Manhattan charged Bankman-Fried with wire fraud and conspiracy for taking customers' money while telling them it was safe. Top deputies Caroline Ellison, Gary Wang and Nishad Singh pleaded guilty and testified. A jury convicted him on all seven counts after a few hours.
When and why
Arrested in the Bahamas in December 2022; tried in Manhattan in October–November 2023; sentenced to 25 years in March 2024.
How we know
Court records, trial transcripts and the judge's sentencing order, which included an $11 billion forfeiture.
Debates and risks
His appeal argued the judge wrongly barred evidence that FTX could repay customers; prosecutors said later repayment does not undo fraud.
▸Scams on individuals: impostors and elder fraud are tracked by Fraud enforcers: DOJ, FBI and the FTCFact, law or data
The connection
Victims' reports flow into the FTC's Consumer Sentinel database and the FBI's Internet Crime Complaint Center, which share them with thousands of police and prosecutors. Analysts link complaints to find networks, money mules and scam call centers. The FTC sues deceptive firms; the Justice Department prosecutes, with an Elder Justice Initiative focused on older victims.
When and why
Nationwide; the FBI center has taken complaints since 2000. In October 2025 the Justice Department moved to seize about $15 billion in bitcoin tied to Cambodia's Prince Group scam compounds.
How we know
FTC and FBI annual data reports; DOJ indictments and forfeiture filings; the National Elder Fraud Hotline (833-372-8311), run by the Justice Department.
Debates and risks
Most money sent to overseas scammers is never recovered, and scam compounds in Southeast Asia sit largely beyond US reach.
▸Charles Ponzi's postal coupon scheme (1920) was prosecuted for mail fraud by Fraud enforcers: DOJ, FBI and the FTCFact, law or data
The connection
Ponzi took money and sent investors notes and letters through the mail, so federal prosecutors charged mail fraud, a law used against swindles since 1872. He pleaded guilty and got five years in federal prison, then faced Massachusetts larceny charges.
When and why
Boston, after his firm collapsed in August 1920; guilty plea in federal court in November 1920.
How we know
Federal court records and press coverage; postal inspectors helped build the case.
Debates and risks
Whether earlier action by Massachusetts officials, who began investigating in July 1920, could have saved investors money is debated.