North Carolina Woman Charged for Allegedly Orchestrating Fraud Scheme Involving $9 Million in USDA Discrimination Financial Assistance

CHARLOTTE, N.C. – A North Carolina woman is facing federal charges for allegedly orchestrating a scheme that defrauded the United States Department of Agriculture’s (USDA) Discrimination Financial Assistance Program (DFAP) of millions of dollars, announced Russ Ferguson, U.S. Attorney for the Western District of North Carolina. A federal grand jury in Charlotte returned an indictment charging Linda Faye Hough, 64, of Rockingham, N.C., with one count of mail fraud and six counts of making false, fictitious, or fraudulent claims to a federal program in connection with more than $9 million in DFAP applications. “Regardless of the program, hard-earned taxpayer dollars should be spent where Congress intended, not to personally benefit those who exploit the system,” said U.S. Attorney Russ Ferguson. “My office is committed to rooting out fraud, safeguarding taxpayer dollars, and preserving the integrity of federal assistance programs.” “A program designed to remedy wrongdoing instead turned into another vector for criminals to defraud the taxpayer. The USDA Office of Inspector General is committed to ensuring taxpayer money is wisely spent. Those who steal from the public can expect to be found and prosecuted to the fullest extent of the law,” said USDA Inspector General John Walk. “When a federal program is defrauded, every taxpayer becomes a victim and those deserving of assistance are essentially robbed of much needed financial help. Fighting fraud is one of the highest priorities in the FBI. We will work tirelessly with our law enforcement partners to take down anyone who unlawfully obtains federal assistance to use in their personal piggy banks," said Reid Davis, the FBI Charlotte Special Agent in Charge. The DFAP (or Program) was established by the Inflation Reduction Act in 2022, which appropriated $2.2 billion in federal funding, to compensate farmers, ranchers, and forest landowners who experienced discrimination in USDA farm lending programs prior to January 2021. To be eligible to receive funding, applicants were required to submit documentation to prove eligibility, including that they owned or leased farmland; that they participated in or attempted to participate in a USDA farm loan program; that they experienced discrimination by USDA employees; and that they suffered financial losses. Individual DFAP awards were capped at $500,000 per applicant. According to allegations in the indictment, from January 2024 to August 2024, Hough allegedly orchestrated a scheme to fraudulently obtain funds from the DFAP, both for herself and for others. As a promoter of the scheme, the indictment alleges that Hough submitted fraudulent DFAP applications for herself and others that contained false information that falsely made the applicants appear eligible for a DFAP award. In some instances, Hough solicited and received kickback payments from applicants, after they received DFAP awards. As are result of the fraudulent applications, it is alleged that Hough caused approximately $9 million in fraudulently obtained DFAP funds to be disbursed to her and other applicants. Hough had her initial appearance in federal court today. If convicted, Hough faces a maximum statutory sentence of 20 years in prison for the mail fraud offense, and five years in prison for each count of filing false, fictitious, or fraudulent claims. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. The USDA Office of Inspector General and the FBI handled the investigation with the assistance of the North Carolina State Bureau of Investigation Financial Crimes. Special Assistant U.S. Eric Frick of the U.S. Attorney’s Office in Charlotte is prosecuting the case. The charges against the defendant are allegations and he is presumed innocent until proven guilty beyond a reasonable doubt in a court of law. On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division (Fraud Division). The Fraud Division is laser-focused on investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.