Swamp Watch: Federal fraud crackdown ramps up

Added: 2026-06-03

[00:00:06]Zack Abraham, welcome back.

[00:00:08]>> Good to be back.

[00:00:09]>> So, Kevin Worsh, like him, don't like him, what do you got?

[00:00:13]>> I think that he's going to do a good job. I don't see any He's a credible guy. I think he's a good pick. When you look at the economic side, on the economic side of things, I I honestly think unless you're really partisan or you have TDS, I think it's really hard to punch a hole in pretty much anybody he's picked for economic office. I I I'm sure he's sympathetic to Trump's interest rate outlook. But he's been around a long time. He's not some like Dove that just, you know, wants to throw free money around. Now, what they do with monetary policy though, the the math has changed. like like look there are going to be no interest rate cuts at any time in the near future. You you can't do that because one of the issues you have generally speaking in monetary policy we raise interest rates to cap demand. Okay? You lower interest rates to increase demand. When you have a fuel shortage like we do and like we're going to for a while, you do not want to do anything to spur demand, right? Because we are effectively going to be playing a game of chicken with global oil supplies and we don't want to step on oil demand, but we certainly don't want to do anything to stimulate it. So, no, I think he's a good, sensible pick. I think he's a respected guy. I think of all the choices he that were getting floated around, Wars was my favorite.

[00:01:40]Um, and I think he's going to do a good job, but I I think there's a lot of people that believe a lot of fantastic things. Rate cuts are completely off the table.

[00:01:49]>> Yeah. And I mean, and I should mention, he's the new chair of the Federal Reserve, but, you know, as you've talked about on the show quite a bit, and as the president has talked about, he wasn't happy with Jerome Powell. Wasn't happy that he wasn't getting rate cuts.

[00:02:00]And so I would presume that he's selected someone who he thinks will deliver him the things that Jerome Powell would not. But again, there's supposed to be this, you know, separation between the president. The president is not supposed to control the chair of the Federal Reserve. But the fact that Trump is Trump, you know, I think that he he wants loyalty and expects loyalty even out of his Supreme Court nominees. Do you believe that he has an expectation that Worsh will play ball with him?

[00:02:29]I'm sure he does. I Donald Trump does not does not strike me as the kind of guy that wouldn't have had conversations with Kevin Worsh prior to this.

[00:02:37]>> And we voted for him, but let's be let's be honest about him. Yes.

[00:02:40]>> Right. But we have to remember that Worsh is one of 12 votes on the FOMC board.

[00:02:46]>> Yeah.

[00:02:46]>> Okay. So he he doesn't make the decision. Um when I look at the rest of the FOMC board, the composition of that is not changing. So, I would expect to see very little change in monetary policy going forward. But what people need to understand is whether he's supportive or on board with Trump, whatever guys, we if we're talking about stock prices, okay, me nor anybody else can tell you what's going to happen.

[00:03:14]Crazy stuff happens, right?

[00:03:16]>> But here here's the thing. Just I want to dispel people of something. There is nothing special or magical going on in oil markets. You are going to have a massive inflationary surge at the end of this year. Are you going to be more like 6%? You're going to be more towards seven and a half. We'll figure that out.

[00:03:34]But you're getting a massive inflationary surge. And anybody that says you're not literally just like you can't take if they tell you the sky's blue, don't trust them. Okay. They they don't know what they're talking about.

[00:03:45]Yeah.

[00:03:45]>> So in an environment like that, you you can't cut you just can't you can't cut rates. Nobody Nobody's going to cut rates. It doesn't matter what Trump says. It would be and it would be it would be it would not be a good economic decision to cut rates either. You don't want to spur demand.

[00:03:59]>> Yeah. All right, let's do some watchdog.

[00:04:03]I like the Vance fraud task force. I feel like it's doing a better job of what Doge was meant to do.

[00:04:12]>> I agree.

[00:04:12]>> Like in a quicker way. So, so far they've recovered uh 22 billion in small business loans that they say were fraudulent, 1.3 billion in Medicaid reimbursements, and I think recovered partially is I think they're trying to claw some of this back still, but I' identified and are in the process of trying to recover. $6.3 billion in government contracts, $60 million in student aid. Uh here is Steven Miller talking uh alongside JD Vance a fraud task force update. I believe based on what I've seen and what I've heard is that we could balance the federal budget if the only dollars that went out of the Treasury went to individuals who were properly, lawfully, correctly eligible to receive them. And that ultimately is going to be what we have to do as a country. In the meantime, because of the vice president's leadership, you are seeing the most muscular, robust, aggressive, dedicated, determined, and speedy effort to shut down criminal fraud that has not only ever occurred in the history of this country, but in any developed nation.

[00:05:13]>> Yeah. And I should I I said recovered. I don't I I shouldn't have said recovered.

[00:05:17]That's incorrect. Referred uh 22 billion in allegedly fraudulent Small Business Administration loans to the Treasury.

[00:05:23]Deferred 1.3 billion in Medicaid reimbursements. A lot of that from California. flagged billions in other questionable spending. So, it's almost and look, whether they recover it or not, you're talking about a huge change moving forward in the amount of fraudulent uh taxpayer funds being used.

[00:05:41]>> Yeah. I So, on the face of it, I'm going to call BS on the idea that you can cut the government deficits strictly by that. But but to to to you know getting back to the original discussion around Doge that you and I talked about 100% of the time >> if any type of cost cutting or fraud cutting program ends up taking away 10% of the deficit or 15 or 50 who cares if it takes away five it's a good thing right so >> nobody the other thing too and and this is what kind of piggybacks on a conversation that you and I were having last week remember when we were talking about I I I think a lot of these people don't do these things because they're bad they do them because they're incompetent, >> right? And they they focus on these easy nonsensical wins because they can't win any other way.

[00:06:26]>> Um, you know, I I I think I think there is I think there is some similarity it, you know, in this in this scenario right here. Meaning, interesting story. I thought about you. Um, we know a friend that works in it for the state of Washington. I want to get more specific in that because >> I've recently had some cause to think that the state cares about what I say.

[00:06:49]Um so I don't I don't want to put anybody else in peril. Right.

[00:06:53]>> Sure. Yeah. Um don't let them know who our friends are. We got to protect our friends. Yes.

[00:06:58]>> Exactly. So anyway, um they were telling me that the state purchased a software database type management program.

[00:07:07]>> Yeah.

[00:07:08]>> 12 years ago. They still have not gone live with it and they have paid user subscriptions and licensing fees the entire time.

[00:07:16]>> Wow. Yeah. That's government >> 12 year to so like like what is that going to look like? Is it going to be like DOSs? Yeah. 12 years ago, right?

[00:07:24]And so now you're at a point why don't even finish implementing it. You just And so again, are these people sitting in smoke filled rooms stroking their hairless cat like trying to come up with ways to defraud you? Mhm.

[00:07:36]>> I I think there's a small percentage that are bad actors like that. Just what you have is just mass incompetency and you've got it on the federal level certainly, but I think even more so you've got it on the state level where it's just pure incompetence and um yeah, I mean I I think I you know that's the and anything that we do that looks into fraud. I mean it's you know I only only the modern day Democratic party could be against that, right? like >> kind of like their stance on data centers. You're just looking at them going what?

[00:08:07]>> Let's putting out fraud.

[00:08:09]>> Let's clarify about this incompetence versus like doctor evil. The government side, I do believe a lot of that is incompetence, lack of care, you know, it's not my money. But I do think it's it's intentional. Obviously, a lot of it on the other side, you know, like the what's happening with Medicaid in California. I mean, they know that they're not running like a care facility, you know, they know they're not running a legitimate business. So, it's the incompetence from the government, but I think a lot of what we're seeing, you know, in Minnesota and California and Washington state with like childcare providers, they know that they're stealing money from the taxpayers.

[00:08:43]>> Oh,und Yeah. 100%. And then I think that, you know, if you think about the way these things work, I think they become institutionalized where you get a lot of people doing this and rubber stamping things because that's just what we've always done. You know what I mean?

[00:08:58]where where you look at it from the outside, you're like, "Oh, but no, you're 100% right." I mean, for instance, what like all you'd have to do is, you know, there's there's a pretty good thick layer of trails or or or or breadcrumbs, right, between the people they're giving this money fraudulently to. And wouldn't you know, a lot of them are immigrants that have just recently registered to vote and just happen to be like 98% on the Democratic side, you know? So, >> but no nefarious intent. No, I mean there's no, you know, nobody's nobody's fishing by the net.

[00:09:30]>> No. And I think the really telling thing is how many, like, for instance, the hospice providers in California that they pointed out, they're not like challenging this, you know, when the payments are deferred or they're closed down or defunded, they they aren't saying, "Wait a second, we're a real hospice. What are you talking about?"

[00:09:47]They're like, "Oh, you caught us. Let's move on." You know what I mean? And it's like, obviously, they've done something wrong. They need to be prosecuted. But Vance said that in total all across the board they believe that there was $186 billion at least in improper payments last year alone. That's more than twice the bianual budget of the state of Washington. I mean that's a significant amount of money and I think that's probably only scratching the surface.

[00:10:13]Oh, I yeah, I look I It's really hard to look like whether you want to attribute it to fraud or like it is really hard to look at the bureaucracy that is the federal government. Yes. And and I'm not saying it'd be easy, but I cannot believe that you could not extract 20 to 30% from that budget and not feel much of a pinch at all. I it might be it might be creative you like or you might it might take some work and digging and I'm sure it would but there's just no way that you have that large of a bureaucracy and and not you know and the more I've dug into stuff here on the state side when you like whatever you see on a state side you just magnify that at a federal level right and and people yeah it's it's wild >> yeah and I think we're improving things for years to come even if you get a Democrat in the White House because when you start prosecuting ing people and putting people in prison in high-profile cases for this kind of fraud like they are doing in Minneapolis. I mean that one woman got what was it 40 years in prison for her involvement in some of the Somali fraud that happened there. Um she was a white woman but she was like at the center like one of the ring leaders or whatever in the feeding America or something fraud. And then you start to have these indictments in California. It does change behavior because if you've been able to get away with something for like 5 years and then all of a sudden there's all these prosecutions. I do believe that that will reduce the likelihood of fraud under any president in the future.

[00:11:44]>> Yeah. I you know I I really wish and there's a litany of things like that and there's a long list and I'm sure a lot of people have it but I really wish that we would pass a law in this country that if if you choose to be a public servant >> and you get caught with any type of now if it if it's like drunk driving or a regular kind of crime or whatever then you're a regular citizen. But if you get found guilty of the misappropriation of funds in whatever way, you get double the regular sentence. Yeah. Right. I because Oh, we go. You know what kills me about this? The people that we pinch are never elected officials, right? And yet they're the ones that benefit from it. And I'm sitting there going, you know, Qui Bono, who benefits here? And you're telling me that the senator that happened to win the election because of that lady's fraud didn't have a handic?

[00:12:32]I mean, come on. Right. They they I want to pin and whether they've got an R or a D next to their name, I want their on a wall, right? Like pin them to the wall and I want double the punishment for them that regular citizens get.

[00:12:46]>> Yeah. I mean, there should be some sort of consequence for, you know, being in charge of a system that allowed that much fraud. Yet the people who doled it out, put no safeguards in place, didn't check on, didn't have any sort of requirement to prove to us you're a hospice or a childcare facility, no consequence for them. You're totally right. It's ridiculous, >> right? And and yet look at me. I'm legally head to the I'm like I am held to the grindstone for anything that goes wrong that any of my employees do. And yet you get elected to public office and oh weird, you know, dis disapprop misappropriation of funds that happened to help me get elected. I didn't have anything to do with it. Oh, that's interesting.

[00:13:28]>> 100%. All right, let's talk about some good news. So the um initiative to repeal the Washington state income tax, record-breaking. They got 100,000 signatures in one week. That's that's unheard of. And part of it, a lot of it, I think, is attributable to the system Let's Go Washington has built where they can get, and they haven't even, by the way, as of that count, mailed out.

[00:13:51]People can pre-order who've already signed one of the initiatives. Those haven't even hit the mailboxes yet.

[00:13:56]>> I mean, and so that's like boots on the ground out gathering signatures. That's insane. So, there's a ton of enthusiasm for it. Not a surprise. Um, but again, I go back to this question of is it too little, too late? So, we continue to see flight already and there's news of new businesses moving all the time and states are taking advantage of that. Get this out of this is a headline from from the Seattle Times. So, you know, Starbucks is like going to Tennessee.

[00:14:25]>> Not really.

[00:14:25]>> Tennessee approved $30 million in a state grant for Starbucks to move there. How do you compete with that?

[00:14:35]They're giving them money to move there.

[00:14:37]$30 million.

[00:14:39]Well, I mean, a good start would be not standing out in front of their business telling people not to buy their stuff, >> but that's asking too much.

[00:14:45]>> That that that would be a start. Look, um uh I've thought a lot about this. It might be too little too late for now. Um for me personally though, I I literally said this at one of our last meetings. I was like, "Look guys, in my opinion, this is like kind of the last ride of Wyatt Herp and the Immortals, right? We got one shot at this sucker >> and let's let's give them hell for the next 18 months and see where we end up.

[00:15:11]But here here's what I do know.

[00:15:14]>> And what I do know is that and I love this place. I was born and raised here. When when the summer starts coming around again, you start looking at going, there's no other place on earth like it.

[00:15:24]>> Yeah.

[00:15:25]>> And what I know is what I love about this place. And if we start making the right decisions, people will come back here for the same reasons they came in the first place. Right. And we can do the other thing too is well let's get back to being Washington. Right. Like I I like you and I have talked about before. I don't think we're turning this into Trump country or Magaland or anything like that. But let's just get back to that kind of like northeastern or blue dog sensible, you know, even shaded blue. That's fine. Let's just get back to common sense. Caring about families, caring about neighborhoods, tough on crime, sensible stuff, clean cities. Right? Right. I I look at the situation we're in. A dear friend of both of ours, Dory Monson, right? Like get back to Dory M. Right. Like we the Dory Monson. I just feel like he's so emblematic of like the heart of Washingtonians. You know what I mean?

[00:16:16]Sensible, good people, not extreme on anything, you know, fans of business.

[00:16:21]>> Yeah. Live life, want to be left alone by the government, you know, >> compassionate. Yeah.

[00:16:28]>> You know, civically minded, civically active, giving back, right? like just we this has just gone so far off the rails.

[00:16:35]It's not even who we are anymore. And um I so I've got hope. I like I just you know it's always darkest before the dawn and um I think the old girls got a few punches left in her and I I think we can win this thing.

[00:16:47]>> Yeah, we'll do whatever we can. It's always darkest before the dawn. That's nice. That's a nice place to end, Zach.

[00:16:52]I like that. All right, we'll see you next week.

[00:16:55]>> All right, thanks for having me.