The False Claims Act applies to any false representation or fraudulent scheme to obtain agricultural subsidies or funds from government agricultural programs.
Customs
Companies that undervalue their imports to lower the amount of customs duties or who underpay customs duties are liable under the False Claims Act.
Environmental Programs
The federal government spends a large amount of money to clean up toxic/hazardous waste. It requires contractors to follow all environmental laws. Contractors that intentionally overcharge the government for waste clean-up, get paid for work they don’t do, or fail to meet government specifications are liable under the False Claims Act.
Improper Cost Allocation
If a company has government contracts and private commercial contracts, it is required to allocate its costs fairly among the different jobs. A False Claims Act issue arises when these contractors charge more to the government than to the private commercial accounts. This lets the contractor quote lower prices to its private customers and make up for the price cuts by charging more to the government.
Public Works Projects/Government Construction
False Claims Act liability may arise with respect to public works projects or government construction if a contractor overcharges, rigs its bids to the government, fails to follow project specifications, or fails to report construction defects.
Research Programs
A grant recipient who misuses monies received for federal research projects may be liable under the False Claims Act. Misuse includes spending the money on a different project or billing the government for services paid for by another source.
Underpayment of Royalties on Government-leased Land
Oil, gas, and lumber companies who obtain or produce their materials on federal and Indian lands are governed by lease agreements with the Interior Department. Private companies are required to pay the federal government and Indian tribes a percentage of the oil, gas, and lumber value as a royalty. Any company who undervalues the oil, gas, or lumber it extracts, in order to pay a smaller royalty, is liable under the False Claims Act.
Yield Burning
Yield Burning occurs when investment banking firms, in an effort to lower their borrowing costs, charge undue prices for U.S. Treasury securities sold to municipalities in connection with certain types of tax-exempt bond refinancing. These excessive prices artificially reduce the yield on the securities. Investment banking firms who overcharge in order to reduce yield are liable under the False Claims Act.
If you have been witness to these or any other activities that could be considered illegal under the False Claims Act, contact Halunen & Associates.
