Hearings to examine certain pending nominations.

To love and serve God, to live with integrity, to pursue excellence, to be grateful and content, and to never ever give less than 100 percent in anything. I am honored that my mom and dad also are here in the room with me today and am thankful for their lifelong love and support. I am also blessed to have a large family supporting from home today, including my father and mother-in-law, my grandmothers, my siblings and their spouses, my wife's sisters and their husbands, and upgraded just two nights ago, my 46 nieces and nephews. I love you all. As for me, I am a career federal prosecutor and a career public servant. I got my start as a clerk for United States District Judge Michael Anello, who graciously welcomed me into his chambers and generously taught me so much about the practice of law. Thereafter, I joined my hometown U.S. Attorney's Office in San Diego as an Assistant United States Attorney. I grew up as a lawyer in that office, mentored by many selfless public servants who gave their talents to their country and their community. Representing the United States as an AUSA has been the honor of a lifetime. The mission of an AUSA is the purest of them all. It's not to win at all costs. It's not to get convictions. It's to do justice for the United States. Meeting that high mark of justice demands equal measures of courage and caution, conviction and compassion, persistence and prudence. It demands a relentless pursuit of the truth, a willingness to follow the facts wherever they lead without fear or favor. As an AUSA and now as an Associate Deputy Attorney General, I have given every last ounce of energy every day to meet that high mark of justice. And I have the distinct privilege of working with the men and women of the Department of Justice who are committed to achieving that same high ideal. Above all other days, I've known that I've reached the high mark of justice when a victim of crime looked me in the eye and thanked me for listening, for caring, and for fighting for truth and justice on their behalf. If confirmed as the AAG for the National Fraud Enforcement Division, I will continue each and every day to give my all for the American people and strive for truth and justice. I welcome your questions.

We'll have five-minute rounds. You heard what I said in my opening statement about my involvement with the False Claims Act. You don't need to give a long answer to this question just to make me feel good, but please tell me what role, if any, the National Fraud Enforcement Division will play in enforcing the False Claims Act.

Thank you, Senator, and it was a pleasure to meet with you yesterday. Senator and Chairman, the False Claims Act is a pivotal tool in the toolbox of the Department of Justice to ensure that our federal programs are free of fraud, waste, and abuse. As you mentioned, this last year was a record number for recovery under the False Claims Act. I look forward to working with my Criminal Division partners, with my Civil Division partners to ensure that the False Claims Act is stronger and sturdier and that our work in that regard is better than ever before going forward.

How would you coordinate with other components of the Justice Department to avoid duplicative investigations and conflicting litigation positions?

Chairman, that's a great question because at step one of any effort within the Department of Justice, we must ensure that the work that we do is as efficient as possible. If one agent or one attorney in one office is working on the same case that another agent or an attorney is working on in a different office, that's not a fruitful exercise for the Department of Justice. What I have done as a career prosecutor is from the get-go ensure that all of our effort is as efficient as possible by building out processes and procedures that enable us to do the maximum amount of work because of those processes and procedures that we've built. What I will do is I will work very closely with all of the partners within the Department of Justice who work in the fraud space, including the False Claims Act and including other fraud efforts, to ensure that there is no duplication of effort and that the National Fraud Enforcement Division is truly complementary to all of the other work that historically has gone on.

I'm very concerned about fraud and scam targeting our senior citizens. I'm going to quote the AARP estimating that individuals aged 60 and older lose at least $28 billion annually as victims of fraud. So what measures would you take through the National Fraud Enforcement Division to protect elderly from fraud?

Chairman, I am highly sympathetic and compassionate to the elderly who are the victims of this sort of fraud. And I will be working closely with my other partners within the Department of Justice to ensure that we use all the tools available to us to bring relief to these victims. And it's not just the grandmothers and the grandfathers, it's also their family members who bear the weight of these scams and the fraud that's perpetrated against them. My grandmother, one of them turns 89 years old in two days, and she has seen these sorts of efforts towards her. And it's a major issue that the Department of Justice is focused on, and we will be using all available tools to ensure that we combat that problem. And I will finish by saying that in my work, it has been a distinct pleasure to work with victims, including the elderly, including one 99-year-old victim of fraud that I worked and had the pleasure of listening to, of hearing her story, of believing her story, and then fighting for justice for her, that 99-year-old in the state of Hawaii.

Fraud and investigation enforcement has historically been handled by Justice's Civil and Criminal Divisions. Because of that, some people have speculated that this new division that you're going to head is redundant or unnecessary. So why is the reorganization of the Department of Justice important to combat fraud nationally and how will the American people benefit from this new structure? That'll be my last question.

Thank you, Chairman. The issue of fraud, waste, and abuse in the country is so vast. An independent study from GAO in April 2024 estimated between $233 billion annually up to about $521 billion annually in fraud against taxpayer-funded programs. The problem is massive. And so President Trump and the Attorney General were right to identify this as a place where we needed to put significant more focus. Even with historic years last year with our Civil Division and our Criminal Division, there is still a vast divide of work that we need to do to ensure that our taxpayer-funded programs are free of fraud.

Thank you. Senator Durbin.

Thank you very much, Mr. Chairman. Mr. McDonald, welcome, and welcome to your lovely family. Be careful with your comments because three of your children are taking notes on everything that you say. And there's going to be a record over there for you to answer to later on. Let me ask you a question about weaponization, which has been a term frequently used by the new administration to stop weaponization. A gentleman by the name of Ed Martin is well known to this committee. He's been removed from two positions already in the Trump administration. I don't know where he is today. But you have been identified as the co-chair of the Weaponization Working Group. Mr. Martin has described that as a group that's going to get even with the people who were critical of the president. Are you co-chair of that group?

Senator, thank you for the question. President Trump was right early in the administration to identify the reality of weaponization in the federal government in the recent past and commissioned the Department of Justice to review certain prior facts and certain prior cases to determine the facts of those underlying the facts underlying those cases and to ensure that those misuses of the government power were not engaged in again. The Department of Justice under the leadership of Attorney General Bondi has been undertaking that work to understand what went wrong during the prior administration, to learn from it, to learn from the mistakes of the past, and to ensure that we do not make those mistakes again into the future.

So the answer is yes, you're co-chair of the Weaponization Working Group?

Senator, I am involved in the work of the Weaponization Working Group. That's been one of my many responsibilities in the office of the Deputy Attorney General.

You're very tactful in your answer. The president is explicit. He's going after the people that he thinks went after him. And as many of us believe, that should come to an end. But you've been part of Mr. Martin's effort, and I just wanted to put that on the record. How about Jared Wise? Do you know him?

Senator, as the Department of Justice has reported, Mr. Wise is an employee of the Department of Justice.

And what was your involvement in the decision to hire him?

Senator, I am not today going to get into any personnel matters with respect to the Department of Justice. I will say that I am not involved in hiring decisions for the Department of Justice.

I understand why you don't want to answer the question. Here's the story on Jared Wise. Jared Wise was here on January 6 with the insurrectionists that stormed the Capitol. He was filmed and he was saying, excuse me, to the police officers, quote, "You guys are disgusting. You are the Nazi. You are the Gestapo." He egged on the violent mob that was attacking police officers yelling, quote, "Yeah, f them. Yeah, kill them." The man was then prosecuted for his conduct and he was subject, of course, to the full unconditional pardon of President Trump and then went to work for the Justice Department in your division. Do you have any problems with his background?

Senator, what I'm here to talk about today is the problem facing the American taxpayer, which is, as I mentioned, between $233 billion annually in fraud perpetrated against government tax...

I want to know more about you. I'm asking if you know Jared Wise and his background and were you part of the decision to make him an employee of the Justice Department after what I just described? It's a simple question. You can say yes, I was involved, no, I wasn't involved.

Senator, I would refer back to my prior answer where I mentioned that I am not involved in the hiring decisions associated with the Department of Justice.

Do you have any problem with his background working for the Justice Department?

Senator, I would refer to my prior answer, which is that the weaponization work in the Department of Justice currently is critical work to understand some of the underlying facts and circumstances of what went on in the prior administration. And the president and the Attorney General was right to focus the Department of Justice...

I think it's more than a seminar on what happened before. It is an agenda, which we're hoping will end, and I don't hear that from you. Let me ask you, were you involved in the decision to disband the National Cryptocurrency Enforcement Team?

Senator, as the Department of Justice has made clear, those personnel with the cryptocurrency expertise have been added to other portions of the Department of Justice. And anyone engaged in any sort of fraud, regardless of the currency, is investigated and is prosecuted where appropriate by the Department of Justice.

Thank you, Mr. Chairman.

Senator Cornyn.

Mr. McDonald, congratulations on your nomination. I'm going to send you a letter dated February 11, 2026, signed by 17 of my colleagues, or 16 of my colleagues plus me, asking the Department of Justice to look at the subsidies under the Affordable Care Act or Obamacare that could not be reconciled by the GAO, the Government Accountability Office. It appears that there were brokers selling ACA policies to people who didn't even know they had received that policy and who made no claims under the policy to the tune, at least in 2023, of unreconcilable expenditures of $21 billion. You know, healthcare is a huge issue for all of us in America, but and the American people are extraordinarily generous when it comes to making sure that their fellow Americans get access to healthcare. But it is infuriating to see this system be gamed to the point that insurance companies receive windfalls of these subsidies and consumers receive zero benefit. Do you commit to working within the Department of Justice to make sure that those sorts of events are remedied and, if possible, recoup overpayments by the taxpayer to these fraudsters for the benefit of the American people?

Senator, what I commit to is working tirelessly to root out the sort of fraud that you've identified there and to make sure that every single dollar that's supposed to go to these programs actually goes to the programs to the beneficiaries, the intended beneficiaries of these programs, and not to fraudsters. That is my commitment.

Well, you're going to be very busy because as you identified the scope of the problem, it is shocking. The GAO in 2024 identified 16 agencies with 68 different programs with $168 billion in improper payments. Now, I suspect that not all those improper payments were as a result of fraud, but still the scope of this is just boggles the mind. And we have about $38 trillion in debt. We're paying more money on interest in the national debt than we are on defense, which is unsustainable. President Trump, thankfully, has agreed to request a larger appropriation for our national security purposes next year, $1.5 trillion. But as you can see, this cannot continue. And I do think the job that you've been assigned to do could play a major role in addressing these improper payments, many of some of which is as a result of fraud, but all of which dissipates the money that taxpayers pay in their taxes, but also exacerbates our financial problems that are, as I said, unsustainable. Do you agree with that?

Senator, I do agree with that. The problem is huge. The Department of Justice, for instance, last year for its total outlay of cost to support the 100,000-employee-strong department spent about $50 billion. The annual fraud against the American taxpayer, conservatively, is $233 billion. We must put attention on this program, and I will work tirelessly to do what I can to root out the fraudsters who are preventing this money and are exploiting the generosity of the American taxpayer and preventing this money from going to the needy beneficiaries.

So I've been trying to figure out how all this could possibly happen. And I think part of it is the way that the federal government actually spends the money and lack of accountability on the part of the people who receive those funds. Obviously, the Somali daycare fraud, obviously the money went to these non-governmental entities which provided nonexistent services and basically stole the money from the American taxpayer. But would you commit to looking at the contracts and the grants that are made by the federal government to these outside groups, whether they be non-governmental organizations or contractors or grantees, to make sure that there is accountability for the funds that they actually receive in order to perform the services that the federal government expects them to perform?

Senator, my commitment is to work tirelessly to build a division, a National Fraud Enforcement Division, where no fraud is too big for the Department of Justice and no fraud is too small for the Department of Justice to have the resources and the commitment to pursue the facts and apply the law wherever they lead to whatever criminally culpable actors there might be in the chain of fraud that we will seek to unravel.

Thank you, Mr. Chairman.

Senator Klobuchar.

Thank you very much, Mr. Chairman. I've made it clear that I believe that we need to root out fraud and that those who steal taxpayer money have to go to jail. That's why I strongly supported Andy Luger as the U.S. Attorney under President Biden. I recommended him for that job. And I also recommended Joe Thompson, the lead prosecutor who headed up the fraud cases to serve as acting U.S. Attorney. The office has indicted 98 people, most of them over the about a year ago or so, and obtained 60 convictions. As you know, Mr. McDonald, we talked about that. I appreciated you talking with me. You worked with Joe Thompson when President Trump announced him as the acting U.S. Attorney. Do you agree that the work that he and the other prosecutors did to investigate fraud in Minnesota is an example of what we should be doing and we should be continuing? And what do you think the prosecutors there did well? And what would you do differently or how would you coordinate with local prosecutors around the country?

Thank you, Senator, for the question and for the time that you spent with me. I really appreciated that. Senator, as you know, the work in Minnesota has been pivotal. The work of the U.S. Attorney's Office there and the personnel there has been pivotal to highlighting the problems of fraud that permeate our taxpayer-funded programs. That sort of effort, which also is undertaken by our healthcare fraud unit within our Criminal Division and U.S. Attorney's Offices around the country, is what the National Fraud Enforcement Division will be looking to do and scale to an extent that we've not seen before within the Department of Justice. I will be working with the Inspectors General community, with our federal agencies and federal partners, with our state and local partners to ensure that we find the fraud where it's occurring and that we have the resources to prosecute it, to investigate it and prosecute it, and ultimately ensure that the fraud that we're seeing annually perpetrated against these programs comes to an end.

Thank you. And given what the president announced last night about the vice president heading this up and other comments that Senator Durbin mentioned, how are you going to assure us that under your leadership that the fraud office that you would head up in the Justice Department follows only the facts and the laws and that political pressure won't play a part? You and I talked about other states that are maybe not blue states that we know have experienced fraud as well in addition to working on the cases in Minnesota.

Senator, as a career federal prosecutor, what I do day in and day out is I uncover the facts and I follow those facts and apply them to the law, following at all times the provisions of the Justice Manual and the principles of federal prosecution to ensure that every every case that I bring is fair and is just. That's what I've done as a career federal prosecutor and that's what I will do if confirmed to this AAG position.

As you know, we've lost Joe Thompson and Harry Jacobs, 14 Assistant U.S. Attorneys, some of them you know and worked with. How do you plan on addressing the exodus from that office? And I know you wouldn't you're not the U.S. Attorney, but how would you manage this when you're trying to work with the locals? I know you believe that the locals have to continue to do a lot of this work. So how is that going to be managed? As you know, they resigned because they did not want to investigate Renee Goode's wife.

Senator, the Department of Justice is filled with incredible talented prosecutors spanning the country in all of our 93 U.S. Attorney's Offices and also in our litigating components in our Criminal Division and in our Civil Division. The Department of Justice will continue to build teams of experienced prosecutors and and couple them with experienced agents to root out this fraud and to ensure that we are able to put a bigger dent into the mountain of fraud than we've ever done before.

And just last, we talked about this, there's also significant consumer scams. In 2020, prosecutors charged more than 60 defendants with a telemarketing scam that swindled seniors of $300 million. Are you going to prioritize these cases as well to protect consumers against fraud?

Senator, I will work with my partners within the Department of Justice to ensure that we have visibility over the entire playing field of fraud and that we are bringing criminal actors to justice. Thank you.

Senator Blackburn.

Thank you, Mr. Chairman, and welcome. We are pleased that you're before us today. I will say that looking at your background, I think the work you've done in drug trafficking and human smuggling, financial fraud really suits you for this position. And I'm pleased to see you put forward for this position and pleased that the president is really taking decisive action to crack down on fraud. It was so interesting after the Minnesota Somali fraud began to be made public, one of the top calls coming into our office was people reporting what they thought might have been some type fraud. So it shows how much this is needed and how correct the president and the vice president and AG Bondi are to say let's do something about this. Congress has a responsibility also and last month, many of my colleagues here joined me introducing a Fraud Accountability Act. And this would clarify the Immigration and Nationality Act to make certain that all types fraud committed against your local, state, federal government and the American people are deportable offenses. So I and I think it's important that the American public see these individuals that have committed this fraud held to account. So I'd like for you to talk for just a minute about why that mission is so important and then how you're going to use this division to attack all types of fraud.

Thank you, Senator. Fighting crime, in particular crime that's public, that's in your face, that's known, that neighbors can sense and feel, but where there is a government that's paralyzed to move in the face of that known in your face sort of of crime and fraud, that is not a good place to be as a country. And that that is a place where where whistleblowers feel like they can't come forward, where victims feel like they are not empowered to share their their story if there is not a Justice Department that is truly working for the United States day in and day out to bring justice to our communities. So the issue of fraud in particular where it is very much in the open and very much in the forefront of the minds of the American people, the Department of Justice must be nimble, must be capable of wrapping our arms around that and endeavoring to fight every day to find where that fraud is happening and to ensure that the public knows.

Okay. One of those areas that we get a lot of calls about is through the Affordable Care Act. And the president touched on this last night with hundreds of billions of dollars that have gone to insurance companies, people that are fraudulently enrolled in these programs. The GAO has done a very revealing study on this. So how do you prioritize these different types of fraud cases like what we see in Minnesota, but also what we are seeing through the ACA where as many as 12 million people that are enrolled have never even used the insurance, which means most of them probably don't know they have that. They were fraudulently enrolled.

Senator, the way that we start cutting into the mountain of debt, or I'm sorry, mountain of fraud, is by leaning on the experienced data analysts and agents who can illuminate the pathway to to the fraud that's occurring in all of these programs. We must be driven by that ground-level work that's done by our data analysts and the agents. They illuminate the pathway to the fraud and then that's where our investigators and the prosecutors step in to then ultimately bring justice in a court of law.

I do want to take my last few seconds here and commend you for the work with the Memphis Safe Task Force. To date, the Memphis Safe Task Force, federal agencies, 23 federal agencies, the National Guard, Tennessee Highway Patrol, Tennessee Bureau of Investigation, the mayor of Memphis, the police chief, working together have made over 7,500 arrests. They have recovered over 1,100 stolen vehicles and 1,200 firearms. And this is exactly the type of coordination that we need to see. And I thank you for your work on that. I yield back. ...1,500 illegal weapons. They have recovered 154 missing children. And I will tell you, having the ability to help oversee and deliver that type program and bring together so many disparate groups, I think is such a credit to your leadership skill. So touch on quickly what you did in overseeing the Memphis Safe Task Force.

Senator, working with the Memphis Safe Task Force and other public safety task forces over the last year has been an incredible honor to bring together people who all want to see the best for their community but have never been able to get into one room to talk about it and to make it happen. And that's what we've done. Under President Trump's leadership, under Attorney General Bondi's leadership, under the director of the Marshals' leadership, we've come together and said, we're going to take on this problem and we're not going to leave this room until it's fixed. And the homicide rate in Memphis has dropped by over 35 percent, violent crime rates have dropped significantly, and the fact that matters most to me are the lives that we have saved. And I will do it again anywhere so that those lives can be saved. It's been an honor to work with the group in Memphis.

Well, states like Minnesota and Illinois would do well to learn from what we've done in Memphis. Thank you, Mr. Chairman.

You bet. Senator Coons.

Thank you, Mr. Chairman. Mr. McDonald, thank you for your dedication to federal service, to your wife, to your children, to your parents, to your family. Thank you for your recognizing the blessing of the opportunity to serve. I am interested in hearing your perspective not just on the role you're being nominated to, but the general direction of fraud enforcement under this administration. Look, Americans, Delawareans, folks of all backgrounds rely on critical federal programs. And when the money that is supposed to be spent by those programs is diverted to fraud, is stolen, that reduces the amount of resources available to do good in our society. And I agree with you, we need to make sure that Americans' tax dollars are spent wisely and those funds are going where they really should go. I am concerned, however, the administration is less concerned with specifically fighting fraud than with targeting people and states it dislikes or that it has a partisan agenda against. One of the reasons I've got this concern is seeing that at the same time the administration's creating a new DOJ division and suggesting it may be directed by the White House, they have shut down or eliminated or defunded other anti-fraud units like the Consumer Protection Branch, like the Tax Division. I think if President Trump were serious about combating fraud, he'd be applauding the great work done by the Minnesota U.S. Attorney's Office under the previous administration to tackle social services fraud instead of running attorneys out of that office. And if he were serious about tackling fraud, he wouldn't be pardoning the very people that dedicated career prosecutors like yourself spent years investigating and prosecuting for stealing from American taxpayers. Let me just start with you, Mr. McDonald. You've spent almost your entire career at the Justice Department as a nonpartisan, apolitical prosecutor. Who does the Department of Justice work for, sir?

Senator, first with respect to some of the assertions in the lead-up to your question, I do want to point out...

It's a pretty simple question. Who's the Department of Justice work for, sir?

Senator, I do want to point out that in the last year, the DOJ has had record-setting years in the area of fraud. Under the False Claims Act, we recovered 12 percent...

Sir, fines collected from anti-money laundering violations are down 54 percent. Investigations into tax fraud schemes are down 63 percent. 25,000 federal agents, including many folks I suspect you worked with, dedicated to investigating white-collar crimes have been diverted to immigration enforcement. Let me move on to just a simple point I wanted to put in front of you. It takes a huge amount of work and investigation and time for you and other dedicated prosecutors to develop a case, to bring it, and to win a conviction, correct?

Senator, there is an extensive amount of work that goes into every federal prosecution, and that's because on the right side of the V is a human being that has rights that must be protected, and we do that every day in the Department of Justice with a mind for the names on the right side of the V.

Correct. And balancing that is a key part of achieving justice, which you're dedicated to. So then how do you explain to your team or to a group of prosecutors who have spent years, a case like Trevor Milton, the founder of Nikola Corporation? He committed securities and wire fraud for misleading investors. He was sentenced to four years in prison. He was ordered to pay nearly 700 million in restitution. In October of 2024, he and his wife gave 1.8 million to the president's campaign. He was subsequently pardoned in March of last year, eliminating not just the sentence, but the massive restitution. I'll give you the case of Lawrence Duran, the owner of American Therapeutic. He pledged guilty to defrauding Medicare of $200 million and was sentenced to 50 years in prison and ordered to pay 87 million in restitution. In May, the president commuted his sentence and pardoned him also, including restitution. How would you explain to your dedicated career team that's investigating fraudsters the president's repeated pattern of pardoning folks, of forgiving not just their sentence, but their restitution obligations in exchange for political contributions?

Senator, respectfully, I do disagree with assertions made there in the lead-up to your question. What I will be doing with my team is I will be equipping them and I will be ensuring that they have everything that they need to go after this fraud better than we've ever done it before.

Senator Kennedy.

Thank you, Mr. Chairman. Counsel, congratulations on your nomination. What kind of fraud are you going to go after?

Senator, the core that I would say that we're going to go after within this division initially as we build out will be taxpayer-funded programs such as Medicaid, such as the SNAP program, and other subsidiary HHS, USDA, etc., programs. We will be putting our view there.

Who is going to make the decision about which of these specific types of fraud you go after?

Senator, in the course of building out investigations, we work directly with the federal investigators...

Who's going to make the decision about which specific types of fraud you go after?

Senator, with respect to this role, I believe I will be working with the Deputy Attorney General and the Attorney General to figure out how we prioritize this mountain of fraud.

So it's you, the Deputy Attorney General, and the Attorney General?

Yes, Senator.

Okay. So if you've got 10 cases of clear fraud, you and the deputy and the Attorney General will sit down and decide which ones to prosecute and prioritize?

Well, Senator, when it comes to the case level, that work happens within our line AUSAs.

Counsel, counsel, I got five minutes. No disrespect, you're a good guy. Answer my question.

At the programmatic level and as we build out the division, those decisions will be made with the Deputy Attorney General and the Attorney General. With respect to specific case questions...

Do you already have cases in mind?

I do not have cases in mind, Senator.

Okay. Suppose we can agree, I think, that the federal taxpayers, American taxpayers, put up between 50 and 90 percent of the money in the Medicaid program. States love it. Let's suppose that you have a governor who knows there's fraud in his Medicaid program, but he ignores it because he would lose all this federal money. Is that fraud?

Senator, I think that's a form of fraud, waste, and abuse. Whether it fits within the contours of criminal culpability, there would need to be...

Is that the sort of thing you're going to look at?

Senator, as referenced earlier, we will be looking at the full scope of fraud in these...

Answer my question, counsel. Is that the sort of thing you're going to look at?

Senator, I do plan to look at the full range of potentially criminally culpable actors.

But let's suppose, are you familiar with an Inspector General?

Yes, sir, I am.

I'm sure you are, because you're a good lawyer. Let's suppose, and you're aware, I'm sure, that Inspectors General act independently of a cabinet secretary. Cabinet secretary, under the law, I think it's 5 USC section 417, can only overrule an Inspector General if what that Inspector General is doing dramatically hurts the U.S. interests or some sort of pretty language like that. Let's suppose an Inspector General comes in and tells a cabinet secretary or senior official, I want to know what cases you're investigating. And you have to tell me. And if any of them are going to impact me in terms of my reputation, I'm going to pull you off of them. Is that fraud?

Senator, I would see that as a form of conflict of interest to the extent that that'll look bad for the cabinet secretary. I...

Well, I know that. Is that the sort of thing you're going to get involved in?

Senator, I will be focused on criminal prosecutions. That will be my focus in identifying fraudsters operating, taking money...

Unless, suppose the Census Bureau tells you that 11 percent of the American people are poor. And we get to decide the definition. But we're not going to, we're going to exclude about 80 percent of the federal benefits that we give to folks in determining this 11 percent. So that instead of 11 percent, we really have only 1 percent of the American people that are below the poverty level. Is that fraud?

Is it fraud if a cabinet secretary knows that and doesn't do anything about it? Senator, there are a range of criminal tools that the Department of Justice can bring to bear.

Is that fraud?

Fraud in the classic sense of executing a scheme to defraud a government program, probably not. That sounds...

Is it right?

No, it is not right.

Is it moral?

No, it is not, Senator.

Is it ethical?

Does not seem ethical to me, Senator.

Thank you for your indulgence, Mr. Chairman.

Senator Hirono.

Thank you, Mr. Chairman. Mr. McDonald, I ask the following two initial questions going to fitness to serve of all nominees who appear before any of the committees on which I sit. I will ask you the following two questions. Since you became a legal adult, have you ever made unwanted requests for sexual favors or committed any verbal or physical harassment or assault of a sexual nature?

No, Senator.

Have you ever faced discipline or entered into a settlement relating to this kind of conduct?

No, I have not.

Mr. McDonald, it's more than ironic that a president guilty of 34 felony counts of fraud proudly announces a, quote, "war on fraud," places J.D. Vance, Vice President Vance, in charge, and nominates you to lead a new anti-fraud division. Now, we all acknowledge that fraud needs to be prosecuted and that there is a lot of it, and you're now going to head the division. And if fraud, as you recognize, is such a massive problem, and there are other Democratic senators who have raised the concern that if fraud is such a massive problem, why would the very divisions within the DOJ that were in charge of prosecuting civil and criminal fraud, why were they disbanded? And again, I mention going after crypto crime, which is massive, going after tax fraud, also massive. So one wonders, you know, I think you can understand why a major concern of ours would be how independent your anti-fraud division will be when all these other divisions that were supposed to be prosecuting fraud and all of the experience that the attorneys there had, they get disbanded, but you get created and your division, not you get created, but your division will be followed by J.D. Vance. So it's kind of hard to understand how it is that you will be so independent of the president. We have a president who expects the people he nominates to do his bidding, including to let him do what he wants, including members of the U.S. Supreme Court. So in spite of the fact that the DOJ mission statement, which I just checked on today, says that it is characterized by the values of independence and impartiality, it's hard for us sitting here to think that you can be all that independent. So if the president, vice president, or any member of the White House, not to mention Pam Bondi, asks, suggests, or hints to you to investigate any of the president's perceived enemies, would you do so? Yes or no?

Senator, respectfully, I disagree with much of what you asserted in the lead-up to that question. The professionals in the Department of Justice who are working on crypto fraud, for example, are in the Department of Justice...

The lead-up, excuse me. You know, this is not my, I'm reclaiming my time. The setup to the question goes to the impartiality of this new division that has been created to combat fraud. And I think that there are enough concerns raised as to how independent you will be. And I'm just asking you, if the president says, go after so-and-so for fraud, would you do so? Yes or no?

Yes, Senator. Senator, as I was mentioning, the individuals who were doing crypto fraud, that work is still ongoing within the Department of Justice.

You are not answering my question, which says to me that sadly, even though you have up to now been an impartial, what I understand is relatively impartial and non-political, you're now placed in a highly politicized division. And we already know that the president considers the Department of Justice to be his law firm, Pam Bondi to be his lawyer. You are down the chain. I don't see how you sit there and tell us that you're going to be independent, much as you might want to be, but I have concerns about that. You know, we have a president who accepted a multi, what is it, a $400 million plane from Qatar. Does that sound to you like a bribe or fraud to you?

Senator, with respect to your prior question, I am a career federal prosecutor...

How about answering this question?

I am a career federal prosecutor. I follow the facts. I apply the law. Those are the two considerations that come into play for me in every case, including in the great state of Hawaii, where I served as a special prosecutor on very significant cases in your state and protected the community and the citizens of Honolulu.

Senator Moody.

Thank you, Mr. Chairman. Thank you for being here. Thank you to your family for being here and supporting you. I know your dad appreciates you and appreciates you being here to back him up. I was once a federal prosecutor in a prior life, and there was nothing more inspiring to me every day than standing up in a courtroom and saying, my name is Ashley Moody and I represent the United States of America. So thank you for your public service. Thank you for loving your country. Thank you for moving your family across the nation to serve in a different capacity. We all move in ways to serve our country in different capacities. I'm living proof of that as the newest United States Senator. So thank you to you and thank you to your family. You know, easy question for you, and I know you will know this, but I think it's important to remind others that the Constitution does in fact require our president to take care that the laws are faithfully executed in this nation, does it not?

It does, Senator.

And that is something that we the people expect of our executive head.

That's correct, Senator.

It's been interesting to me to hear in a nomination hearing to determine who should lead as an Assistant Deputy Attorney General over fraud, the objections to that. I've sat through hearings addressing fraud previously and heard from the other side of the aisle, well, there's always been fraud. There's always been fraud. Why are we talking about it now? And now I think the objection is, why are we restructuring to focus on fraud? Why are we restructuring? Not questions pertaining to you and why this is so important not only to the DOJ and the structure to focus on a very serious problem, but why this is important because we've never seen the magnitude of this level of fraud. And so I'm so glad to focus on that right now. In fact, you misspoke earlier and you corrected yourself, but I think what you said was true. You said we are going in cutting down on the mountain of debt. And then you said, excuse me, cutting down on the mountain of fraud. But the amount of fraud that we see right now in terms of the amount of taxpayer money going to illegitimate recipients or bad actors or criminals now exceeds the entire budget of the state of Florida, the third largest state in the nation. It now exceeds most federal agencies and departments. Is that true?

Senator, I don't have the exact numbers, but I would take your point. It sure seems it's a huge number and I would not be surprised if it exceeds...

And so when you misspoke and said cutting down on the mountain of debt, in fact, the more and more money we take from our citizens, we the people, to fund their government that's supposed to be acting in their interest, not government itself. And certainly I know that there's a debate on the fundamental principle of who government is supposed to protect first and foremost. I actually believe it's American citizens. I know the other side of the aisle thinks differently. That was on full display last night. But if in fact the goal is to make sure that taxpayer money is being used in a way that is responsible and accountable to we the people, restructuring the DOJ when fraud has now eclipsed 10 percent of our federal outlay, according to Besant, that seems to be a no-brainer. In fact, it seems to be a responsibility that we should all own and deliver for the American people that are trusting us. Would you agree?

I absolutely agree. We must be good stewards of the generosity of the American taxpayer.

And that is going to be the primary responsibility of this new division. Is that correct?

Finding the fraud that's occurring against taxpayer-funded programs and making sure that every dollar that's dedicated to these programs actually makes it to its intended beneficiaries.

You know, the other side of the aisle keeps saying they are concerned that you may be in some way communicating with or talking to the White House specifically designated the Vice President Vance to address fraud because it is now surging in this nation, placing debt on generations to come because we're giving it to criminals and bad actors. In fact, if in fact the Constitution requires that the president take care that the laws be faithfully executed, it would be a dereliction of duty if they did not ensure that we stop this fraud. Is that correct?

I agree with that, Senator.

And you will be responding or reporting directly to the Deputy Attorney General and the Attorney General as you build out this new division. Is that correct?

That's correct. The Department of Justice has promulgated the new organizational chart which shows that this AAG position functions like the other 10 AAG positions reporting to the Deputy Attorney General.

Well, I for one commend you for taking on this new responsibility. I told you I'm going to call you the fraud czar. I called for that months ago. We need that in this country. That's your new nickname. Good luck to you. Thank you for answering the call to serve.

Thank you, Senator.

Senator Hawley.

Thank you, Mr. Chairman. Mr. McDonald, congratulations on your nomination. It comes not a moment too soon. Two weeks ago, the CEO of LexisNexis told me under oath that the federal government, according to their estimates, to their own expert research, loses $1 trillion per year to fraud. $1 trillion. That's more than the entire defense budget for this year. A more conservative estimate, the GAO's estimate, is that the federal government loses about $521 billion to fraud every year. That's about the budget of the Department of Veterans Affairs. Either way, we're talking about just enormous amounts. And of course, we've seen it on display in states recently like Minnesota. My question to you is, are we going to see some more accountability coming for the fraud that has been perpetrated on this country, particularly in places like Minnesota? I mean, is accountability coming?

Senator, our goal will be to bring accountability. It will not be easy, but we will work tirelessly to bring that accountability to ensure that the fraud that we are seeing annually is erased.

Let me just give you one example of the kind of accountability I think we need to see. The Attorney General of the state of Minnesota, Keith Ellison, was in front of a committee of mine and under oath, I would just say, just a couple of weeks ago. Mr. Ellison is right at the center of the scandal, the Somali fraud scandal that has rocked that state. Just to take one piece of it, a group called Feeding Our Future, as you probably know, defrauded the federal government of at least $250 million. $250 million that did not go to feed the homeless, it did not go to feed the poor, it did not go to feed children. Instead, it bought yachts, it bought luxury planes, it bought fancy vacations. It was smuggled out of the Minneapolis airport in suitcases. 12,000 pounds of $100 bills smuggled out of the Minneapolis airport in suitcases, for heaven's sake. 60 people, I think, have been charged with wrongdoing as part of this corruption scheme. But here's the deal. The leaders of this organization, this fraud outfit, came and met with the Attorney General Keith Ellison directly. They talked to him for 54 minutes. This was back in 2021 and complained to him that they were being investigated, heaven forbid. And he offered to help them. They repeatedly offered him campaign contributions. And we know this because they recorded the meeting. 54 minutes of recording that we have because the fraudsters recorded the meeting. Ellison tried to deny it. It's all on tape. They offer him money repeatedly and he says things like this, I think we may have a poster of it. He says, we are in the middle of the battle with agencies now who are investigating them. He says, he's the Attorney General of the state, he says, Walz, meaning the governor, agrees with me that this piddly stupid stuff running small people out of business is terrible. Piddly stupid stuff meaning investigation for mass fraud. He goes on to say, just to be able to say, just getting the question, just getting the inquiry from the Attorney General is sometimes enough to make people knock it off. In other words, he offered repeatedly to help them get rid of the investigations that were ongoing into this group. Even as they were sitting there, he said to them, I am directing my staff right now to intervene on your behalf. And then just days after he met with them, he took $10,000 in campaign contributions, including from individuals who were indicted by the federal government for fraud. He's been charged with nothing. And in fact, he sat where you're sitting under oath and he denied to me he took any money at all. I've got it right here. It's in his own campaign finance reports. $10,000, including from indicted individuals and others who are associated with this group, members of this group that defrauded the federal government of $250 million. My question to you is, are we going to see accountability for people like that? Are we going to see heads roll for people who are in the middle of this fraud and enabled it and protected the fraudsters and defended it and used their office in order to help people get away with crimes?

Senator, first, that is certainly not how law enforcement is supposed to work when there is evidence and when investigators are digging into potential crime to then have lead law enforcement try to close up that shop and turn away the investigators. That's not how law enforcement's supposed to work and it's certainly not how law enforcement's going to work in the Department of Justice and in the National Fraud Enforcement Division. We will be, the vision that we have is a division that is large enough where no fraud is too big and no fraud is too small so that we can reach all actors within the chain of criminal culpability and no one more than that, only those within the chain of criminal culpability. Those are the ones that we are going to be looking after, investigating, and following the facts without fear or favor.

Good. I think that's absolutely vital. I think it's long overdue. You said that no fraud is too big or too small. I hope that will also mean that no elected official is too big or too small, because those who helped enable this fraud, those who stopped investigations, they should be prosecuted too. If we don't get accountability, as you know, Mr. McDonald, this will never stop. And we need accountability now.

Senator Welch.

Thank you very much, Mr. Chairman. First of all, I think all of us are absolutely outraged by fraud and we want to get to the bottom of it and more power to you. Everything that Senator Hawley said I agree with. So I don't think there's a dispute about that. One of the concerns that I have is the erosion of the sense of impartiality in the Justice Department. And there is counter-accusations on each side. It's become a very partisan issue here. But my understanding is that there was a weaponization working group, and I think Senator Durbin asked you a little bit about this. But my understanding, and by the way, first of all, let me say thank you for coming into my office and we had a very good visit. So let me acknowledge that and appreciate the career that you have had. But the weaponization working group is something I want to ask you about. My understanding is that you were a part of that.

Senator, first let me say thank you for welcoming me yesterday. It was a pleasure to be with you and my family's going to be enjoying the treat from your home state over the weekend. Thank you for that. Senator.

The treat, Mr. Chairman, was Vermont maple syrup. All right. Just keep on my good side. You may be next.

Okay. We look forward to a good pancake breakfast on Saturday, Senator. Senator, with respect to the Weaponization Working Group, the President was right early in his term to identify and to commission the Department of Justice to look into instances of potential weaponization of the federal government. Under the direction of Attorney General Bondi, the Department of Justice has been doing that, has been looking into certain prior events so that we can learn from them, so that we can learn from history and not repeat those mistakes into the future.

All right. Let me be clear. In my, I am appalled by the Weaponization Working Group because everything that I hear from the President is that the people that he disagrees with become his political enemies, and then he uses the Justice Department to go after them. There is absolutely no place in our justice system for the Department of Justice to be doing that. Would you agree?

Senator, I think you may have misunderstood the work of the Weaponization Working Group. The Weaponization Working Group has been looking at instances of weaponization of the government during the Biden administration.

Be specific. Be specific.

Senator, there is a list of different events and different matters that the Attorney General has commissioned the Department of Justice to look into. One of them, Senator, would be the treatment of the President by the Special Counsel's Office by doing things like dropping historical amounts of discovery on a criminal defendant and then pushing for very, very unreasonable trial dates and setting a criminal defendant on a path that did not allow for due process rights of the defendant to be followed. And any career federal prosecutor who is before you, they will tell you, if they're being honest, that what happened there with the scope of discovery and the timelines that those prosecutors were pushing, that that was not consistent with the principles of federal prosecution.

So who won the 2020 election?

Senator, Joe Biden was certified President of the 2020 election and served four years in office.

Who won the 2024 election?

Senator, President Trump was certified as the winner of the 2024 election and is currently in office.

You know I know that. So did Joe Biden not win but was certified?

Senator, I would refer to my prior answer to that question.

But I'm asking you a different question. I'm asking you whether it's your opinion that Joe Biden was certified but that he didn't actually win. That's the President Trump point of view.

And Senator, my answer was that Joe Biden was certified as President and served four years in office.

Okay. That is not what I asked you. I asked you who won it, not who was certified. Do you want to give me an answer on that?

Senator, I would refer to my prior answer.

Okay. I yield back.

Senator Schmitt.

Thank you, Mr. Chairman. Mr. McDonald, if confirmed, you're going to be tasked with leading the DOJ's efforts to investigate, prosecute, and remedy fraud affecting the federal government. Is that correct?

Yes, working with other partners within the DOJ. Yes, Senator.

That's great to hear. I do think that this issue of fraud and the epidemic is one of the most pressing issues that we can face as a country. Luckily, we have a President who agrees with that, who didn't just identify the problem last night, he declared war on fraud. And I think that's exactly what this moment demands. What we're facing, and you'll be tackling, is not just scattered misconduct, it's not bureaucratic inefficiency in the terms that have been used in the past, it's not an accounting error. It's organized theft on a national scale. People scammed the system, they saw vulnerabilities, they took advantage of it to the tune of billions and billions of dollars. And I think about the guy swinging the hammer or driving the truck who works his tail off and sends his money to Washington, D.C. that goes out the door. And you have this situation like Minneapolis where the Somali community figured out a way to do it to the tune of billions. And it's not limited just to that example, but I just think it's a massive, it's a tip of the iceberg that we have to address. And so it could be that the federal government loses a trillion dollars a year in fraud. And if you think about it, if we got that under control for like a decade, that would make a big difference. I mean, a trillion dollars is a trillion dollars and it adds up. And this isn't abstract. This is money taken away, as I mentioned, from American workers. In a normal country, losing a trillion dollars worth of fraud would trigger an emergency action. But in this town, it may trigger a hearing, but after that, silence. And I think that's where you come in and the work that you're going to do with other federal prosecutors. I'm glad that the President has tasked Vice President Vance, presumably to work with you and kind of help lead this effort as well in mobilizing a national effort to take this on. I think President Trump is changing the structure of Article II to go after fraud and not a moment too soon. Fraud today is industrial, it's coordinated, it exploits federal grants, welfare programs, immigration systems, Medicare, Medicaid, tax credits, subsidies, donor platforms, and nonprofit pipelines. It's sophisticated. It's data-driven. It moves faster than any bureaucracy that has been established. And for far too long, enforcing that has been reactive, fragmented, and hesitant. I can just tell you as a former prosecutor, former Attorney General, this sort of pay-and-chase model, it doesn't work. And I think that, unfortunately, and I don't know why, only one party in this town seems to be concerned about it. This should be a bipartisan issue. I can't actually believe that it isn't. But yesterday, when the President announced this historic effort, the other side sat stone-faced. Much like they did when the President asked a very simple question: Do you think the federal government is here to protect American citizens or illegal aliens? Stand up if you believe that. Republicans stood up, Democrats didn't. I actually can't believe that's where we're at right now. I can't, but it's where we're at right now. And you look at Minnesota specifically, where efforts to crack down on fraud were met not with support, but with accusations of fascism and racism. Fraud networks operate because they believe the risk is low and the reward is high. That's an incentive structure. And wars are fought by changing incentives, and that's what we're going to do with this war on fraud. My advice, for what it's worth, be aggressive, prosecute relentlessly, and recover the assets on behalf of the American people. I know you're up for the challenge. I was glad to see that an experienced person like you has been put in charge here. And to my Democrat colleagues, this shouldn't be bipartisan. Good Lord. Your constituents in blue states pay taxes and they're being ripped off too. I can't believe it. We all represent everybody in our states. This shouldn't be bipartisan. And I think people expect, there's something also in addition to the money that's at stake here, just sort of one final note. It's the trust of the American people. When that trust is eroded and people feel like there's just no accountability for this stuff, people lose hope, they lose faith. They think that their vote doesn't actually matter. And that's what I hear about a lot. They say, what in the world are you guys doing up there when something like this happens and there's no consequences? So just briefly, could you just talk about your approach to this, how you see it, and how you intend to regain that trust of the American people?

Thank you, Senator, and thank you for that advice. And I would say the word relentless, which you used, that word may just well become the motto of the National Fraud Enforcement Division. We will be relentless. We will live every day with tenacity to follow the facts, to find where the fraud is occurring, and to do our absolute best to illuminate the criminal actors that are stealing from the American taxpayer. I will be working, what I will do is I will work with the entirety of the Inspectors General community, with any willing partner, anyone, to come together to put the best minds on this problem set to solve it, both with respect to the security protocols on the front end to ensure that the money does not go out the door where it shouldn't, but then on the back end with the Department of Justice of prosecuting those who are in fact engaged in the fraud. It'll take a whole team effort, and I enjoy building teams. I enjoy building processes and systems to ensure that the attorney in the courtroom has all of the resources and the foundation in place to do well and be confident to represent the United States in court. I enjoy building teams and doing that work. That's what I will do in this new position if confirmed.

Wish you all the best. Godspeed to you, sir. Thanks.

Before Senator Schiff, it looks like we're just about done here. Senator Schiff's got five minutes, so if anybody else is here in the next five minutes, otherwise we'll adjourn the meeting. Senator Schiff.

Thank you, Mr. Chairman. Mr. McDonald, were you part of the DOJ's Weaponization Working Group?

Senator, as referenced earlier in some questioning during the hearing today, the Weaponization Working Group as commissioned by the President...

A simple, a simple yes or no would do. Were you part of the Weaponization Working Group?

Senator, as I referenced earlier in in questions before the panel, the Weaponization Working Group as commissioned by the President and then the Attorney General has been...

I still haven't, I still haven't gotten an answer. Were you involved with the Weaponization Working Group, yes or no? It's a simple question. You were either involved with it or you weren't.

Senator, as referenced earlier...

Yes or no, Mr., yes or no, Mr. McDonald.

Senator, as as I referenced earlier...

Are you refusing, are you refusing to, I'm not interested in what you referenced earlier. I'm asking you a simple question right now, not earlier, but right now. Were you part of the Weaponization Working Group at Justice, yes or no?

Senator, as I referenced earlier...

Okay, you're not going to answer the question. You're not going to answer the question. I don't know why you won't answer a simple question, but let me ask you a different question. Do you believe that members of the Weaponization Working Group need to abide by the Justice Department manual? Yes or no?

Senator, as a career federal prosecutor...

I'm asking you a simple question, yes or no. Are, I'm glad you're familiar with the...

I am very well familiar with the US Department of Justice Justice Manual.

I'm glad you are. Do you feel the manual applies to people in the Weaponization Working Group? Do they have to abide by it? Yes or no?

Senator, as you know, all...

Why is that a difficult question for you to answer? Do you believe that members of the Weaponization Work Group have to abide by ethical practices?

Senator, all Department of Justice employees, every day...

So is that a, is that a yes? I'm asking a very specific question. Not about all department employees, but about employees in the Weaponization Working Group. Do they have to abide by the Justice Department manual? Yes or no?

Senator, all Department of Justice employees...

So that's a yes? Is that a yes? Is that a yes, Mr. McDonald, is that a yes?

Senator, I would refer you to the answer that I just gave.

Or is the Weaponization Working Group something different? Are you suggesting that it's different, that it doesn't have to abide by the ethics manual? That it doesn't have to abide by ethics at all? Why are you refusing to answer a simple question?

Senator, I'm not refusing to answer your question.

Well, do the members of the working group have to abide by the Justice Department manual?

Senator, as I referenced in my previous answer, all Department of Justice employees...

Okay, I'm not interested in what you, I'm not interested in your previous answers. You can't answer a simple question or you won't, which leads me to suspect you believe they don't have to apply, they don't have to live up to the standards of the Justice Manual. So let me ask you a different question. In your time working with this group, did you ever observe any of the other members of the Weaponization Working Group violate the Justice Department manual? Yes or no?

Senator, the Weaponization Working Group has been working to...

I'm not interested in, I'm not interested in a filibuster of an answer. Did you observe members of the working group or did you yourself violate the Justice Department manual?

Senator, as referenced in prior answers, the Weaponization Working Group has been working...

So you're refusing to answer that question. So let me ask you another. Did you, did you witness members of the weaponization working group mishandle grand jury material?

Senator...

Did that come to your attention?

As I referenced earlier, the the Weaponization Working Group has been working to understand the facts and events underlying significant weaponization of the government during the Biden administration.

Mr. McDonald, Mr. Chairman, Mr. Chairman, Mr. Chairman, Mr. Chairman, I'm asking for a simple question. I would ask your help in getting a direct answer. I've asked the witness whether he believes members of the Weaponization Working Group at the Justice Department need to abide by the Justice Department's own Justice Manual. Would you assist me in getting an answer to that question?

No, I will not assist you.

Okay. Well, you have the Chairman's support in not answering the question. So let me try another question. Or let me see if I can get clarity again. Did you ever witness any of the members of the working group violate rules regarding grand jury secrecy? Yes or no?

Senator, as I referenced in my prior testimony, the Weaponization Working Group...

You won't answer that question. So let me ask you one last, one last question and see if you're willing to answer it. Mr. McDonald, did you ever witness anyone in the Weaponization Working Group violate the law? Yes or no?

Senator, I would refer you to my prior question, prior answer.

Your prior answer was to obfuscate and it's become very clear you're unwilling to answer very simple questions because it's very clear what that weaponization group is all about, and that is using the awesome powers of the Department of Justice to go after the President's enemies. I yield back, Mr. Chairman.

Senator Schiff, maybe I gave a short answer to your question, but I've never been asked that I can recall the same question you asked me, and I think it's quite appropriate that I say that it's between the two Senators or the Senator and the questioner to answer. Now, the meeting is adjourned just as soon as I say thank you to the nominee for his testimony today. Written questions for the record may be submitted until March the 4th at 5:00 PM, and we would ask that you answer them very expeditiously because until those questions get answered, we won't take up your nomination. Thank you very much. Meeting adjourned.