Andrew Cuomo, Governor of New York State, speaks at a press conference in New York City on September 8, 2020.
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The New York attorney general is investigating whether a health clinic in the state has fraudulently received Covid vaccine doses and distributed them to the public, Governor Andrew Cuomo said on Monday.
Cuomo declined to provide details of the investigation as it is ongoing. However, he noted that it was the ParCare Community Health Network, which the state has identified as a provider in Orange County, New York. Parcare allegedly misrepresented itself to the state Department of Health in order to receive doses of vaccine, Cuomo said.
New York State Health Commissioner Dr. Howard Zucker said in a statement released over the weekend that the clinic "may have redirected the vaccine to the public" – contrary to the state's plan to give it to the health frontlines first as nursing home residents and staff. "
Because vaccine doses are so scarce, states are rationing vials to specific priority groups before making them more widely available.
ParCare did not immediately return CNBC's request for comment, but the clinic said on Twitter that it will "be actively working with the New York State Department of Health".
It is among the earliest cases of suspected Covid vaccine-related fraud, but it's unlikely to be the last, Cuomo said, adding that cheating with a valuable asset is "almost an inevitable function of human nature."
"We want to send a clear signal to the providers that we will find out and will be prosecuted if you break the law on these vaccinations," Cuomo said at a press conference on Monday. "You will see more and more of it. The vaccine is a precious commodity and you have a lot of people who want the vaccine."
New York State Police have conducted a criminal investigation, Cuomo noted, and will refer the case to New York AG Letitia James, whose office has not returned CNBC's request for comment.
To give a clear signal to potential vaccine scoffers, Cuomo said he would sign an executive order on Monday setting out the consequences of defrauding the state in the distribution of vaccines. He said the state could fine violators up to $ 1 million and the state would revoke the health care provider's license to practice in New York.
"We mean this very seriously," he said. "We'll find out and it's not worth risking your license and any possible civil and criminal penalties."
Cuomo described the penalties as "the strictest in the nation," adding that New York is taking a "hyper-cautious, hyper-vigilant" approach.
"We put the penalties in place. We put the security in place, but when you deal with thousands of people, hundreds of organizations, and one valuable asset, expect some level of fraud," Cuomo said. "As surely as night follows day, you will have people cheating on the government."
"I understand the value of a vial," he added. "Some of these vials can make 10 vaccines. You could sell that one vial, so I understand the temptation."