During the 2013 fiscal year, the Justice Department secured $3.8 billion in settlements and judgments from civil cases under the False Claims Act (FCA). This dollar amount, which is the second largest annual recovery of its type in history, brings total recoveries under the FCA since January 2009 to $ 17 billion – nearly half the total recoveries since the FCA was amended 27 years ago in 1986. The largest annual recovery was in 2012 with nearly $5 billion recovered.
“It has been another banner year for civil fraud recoveries, but more importantly, it has been a great year for the taxpayer and for the millions of Americans, state agencies and organizations that benefit from government programs and contracts,” said Assistant Attorney General Delery. “The $3.8 billion in federal False Claims Act recoveries in fiscal year 2013, plus another $443 million in recoveries for state Medicaid programs, restores scarce taxpayer dollars to federal and state governments. The government’s success in these cases is also a strong deterrent to others who would misuse public funds, which means government programs designed to keep us safer, healthier and economically more prosperous can do so without the corrosive effects of fraud and false claims.”
Most actions are filed under the FCA whistleblower, or qui tam, provisions, which allow private citizens to file lawsuits alleging false claims on behalf of the government. If the government prevails in the action, the whistleblower is eligible to receive up to 30 percent of the monies recovered. There were 752 qui tam suits filed in fiscal year 2013 with whistleblowers recovering $345 million.
“These recoveries would not have been possible without the brave contributions made by ordinary men and women who made extraordinary sacrifices to expose fraud and corruption in government programs,” said Assistant Attorney General Delery. “We are also grateful to Congress and its continued support of strengthening the False Claims Act, including its qui tam provisions, giving the department the tools necessary to pursue false claims.”
The FCA has been under attack recently by the U.S. Chamber of Commerce who has proposed amendments that will hinder the FCA as well as the detection and prevention of fraud at large. See a previous blog post regarding this here.
Since the inclusion of the Qui Tam provision the detection and prevention of fraud has risen exponentially. In 1986, prior to the reform, the U.S. government recovered 89 million dollars from detecting and prosecuting fraud. In 2012, that number rose to 4.95 billion dollars, 68% of that money was recovered via Qui Tam actions. All of this information and more is available in the National Whistleblower’s Center’s FCA Report.
For more details on the 2013 False Claims Act recoveries view the DOJ Press Release: Justice Department Recovers $3.8 Billion from False Claims Act Cases in Fiscal Year 2013.