Has a potential client come to you who is talking about fraud involving a contract or program that receives government funding? That person just might have a strong suit for filling a qui tam case. To give you an idea of what we are talking about consider just a few of the following examples of frauds that have been uncovered; keep in mind that the list goes on and on.
- Billing for goods and services that never existed
- Upcoding either for false illnesses or treatments or for employee work by charging higher doctors rates
- Defective testing saying something passed a test when it failed
- Failure to report known product defects while still billing the government for the product
The False Claims Act is an important federal law that combats fraud against the Government, but many people have never heard of it. This vital act allows individuals with evidence of fraud to sue companies on behalf of the government for damages.
Private individuals can sue entities and individuals that commit fraud against the Government because the act contains a qui tam provision, which allows individuals to act on behalf of the Government. Through the qui tam provision, the False Claims Act encourages whistleblowers with information about wrongdoing to step forward by providing them with a favorable percentage of the ensuing recovery, typically between 15 and 30 percent of the proceeds collected by the Government. This is designed to provide the whistleblower with some compensation for filing a case, and the time and expense that a False Claims Act case can demand.
By encouraging employees and other individuals to come forward, the False Claims Act attempts to discourage fraud and recover stolen funds, which equate to taxpayer money.
Enacted during the Civil War, the False Claims Act, also identified as “Lincoln’s Law,” came to fruition as an answer to crooked contractors on the take who deceived the Union Army by selling substandard goods, including:
- Bullets filled with sawdust instead of gunpowder
- Bags of sand instead of sugar
- Boots crafted with cardboard that fell to pieces
- Lame horses that were useless on the field
Today, the False Claims Act has proven itself as a significant resource to recover taxpayer money that fraudsters have swindled from the Government and a powerful mechanism to detect and stop the fraud. Many of these cases, originated by whistleblowers, have resulted in favorable outcomes for both the Government and the whistleblowers.
“Lincoln’s Law,” has withstood the test of time and still stands as one of the Government’s most robust weapons in the arsenal for battling fraud against the Government.
In order to successfully navigate this complex landscape, you need to know how to advise your clients who have potential qui tam claims about their options so that together you can make informed decisions about how to best move forward with their potential claims. Learn more about the False Claims Act here.