Cuccinelli Blasts IRS for Holding up State Funds - FOX 21/27 WFXR Roanoke/WWCW Lynchburg News, Weather

Cuccinelli Blasts IRS for Holding up State Funds

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Attorney General Ken Cuccinelli claims the IRS is blocking the release of $125 million it owes Virginia from a Medicaid fraud settlement.

Cuccinelli says the agency refused to finish a two-page form that would allow the Treasury Department to cut the check.

Just a few hours after Cuccinelli's press conference, federal officials spoke out, and said they are prepared to cut a $10 million check, but need more information before handing over the rest, though they have confirmed that the state will get $115 million.

The money owed to Virginia is part of a $1.5 billion Medicaid settlement with drug maker Abbott Labs.

Virginia led the investigation that led to the payout, to settle allegations that Abbott Labs promoted an anti-seizure drug for uses not FDA-approved.

Cuccinelli says his office had earmarked most of its share of the payout for local police departments to buy vehicles and equipment and to help pay for training.