The False Claims Act: What it Does and How Private Whistleblowers Can Use It

We talk a lot courthouseabout the False Claims Act (“FCA” or “the Act”)) on this blog.  We do that because it is a powerful tool that allows ordinary Americans to take a stand and fight fraud.  The frauds it fights are frauds perpetrated against the government and government programs, frauds that are ultimately crimes against the American people.  Our posts often look at specific cases involving alleged violations of the FCA, but from time to time our whistleblowers’ law firm likes to take a step back and look at the FCA more generally to help our readers understand exactly what kind of wrongs the FCA tackles.

“A False or Fraudulent Claim”

The FCA is actually several sections of the United States Code, with 31 U.S.C. §3729 containing the basic description of what actions violate the Act.  Although it is only one of a number of subsections that describe these actions, §3729(1)(a) explains the basic wrong the Act tackles “a false or fraudulent claim for payment or approval.”  Essentially, this means that a person or entity is liable under the Act if they ask the government to pay an obligation that is not actually due or ask for more money than they are actually due.

The FCA applies to claims made to the federal government or any of its agencies including the Medicare program and the military.  Many states have similar laws that cover fraud on the state level.

Notably, the Act covers more than just, for example, a bill for widgets that were never delivered.  The Act has also been read so that it includes frauds like claiming widgets meet certain requirements and billing the government for those widgets despite knowing they do not meet the standards.  In the health care world, a false claim includes a request for Medicare to pay for services that were not medically necessary, duplicate billings, or otherwise falsifying files to justify a higher payment than is actually due.

The Knowledge Requirement

One of the most important components of liability under the Act is the knowledge requirement.  As the Department of Justice explains in its publication The False Claims Act: A Primer: “A person does not violate the False Claims Act by submitting a false claim to the government; to violate the FCA a person must have submitted, or caused the submission of, the false claim (or made a false statement or record) with knowledge of the falsity.”  Ultimately, this means that the FCA is not aimed at simple mistakes.  Instead, it is about deliberate, knowing attempts to defraud the government.

The Qui Tam Provision

How does the Act work?  Sometimes the government initiates a claim under the FCA, but often claims are brought pursuant to the FCA’s qui tam provision.  This is a special section, contained in 31 U.S.C. § 3730, that allows private individuals to bring actions on the government’s behalf.  It exists because the government recognizes that it cannot fight fraud without the help of the people who witness these wrongs.  Whistleblowers, also known as relators, can act on behalf of the government and bring a claim against an entity or individual who violated the FCA.  As the claim progresses, the government may choose to intervene and take over the suit.  Either way, the law protects the whistleblower from retaliation and also provides a substantial reward should the claim lead to a recovery of funds by the government (e.g., a settlement or verdict).

Our Whistleblowers’ Law Firm

The FCA is a complicated statute with complicated rules.  Anyone who has witnessed fraud on the government and believes that fraud may violate the FCA should contact a skilled lawyer who understands the Act.  Attorney Greg Brod and his team have the experience and knowledge to help whistleblowers navigate the FCA and, ultimately, help private citizens fight fraud on the American government.

If you believe you have witnessed fraud on the government or a government program (including fraud at the state level), please call (800) 427-7020 to arrange a free consultation to learn more.  You can make a difference.

See Related Blog Posts:

Another Major Settlement in a Pharmaceutical Industry Health Care Fraud Case

The False Claims Act and the Health Care Fraud Fight in 2016

False Claim FAQ, Part Two: The Importance of Whistleblowers and Our Whistleblowers’ Law Firm

(Image by Robert Linder)