False Claims Act and Civil Fraud Cases

The attorneys at Nicholson & Eastin, LLP assist our clients with matters arising under the Federal and state False Claims Acts. As a former federal prosecutor, the Managing Attorney of the firm prosecuted civil and criminal False Claims Act cases.

What is the False Claims Act?

The Federal False Claims Act allows the government to sue health care providers and entities, as well as other persons and entities that submit or cause the submission of false claims for reimbursement to the government, for damages and penalties. The government can also sue in cases where money owed to the government is not paid. The False Claims Act provides for treble damages (three times the amount unlawfully obtained or not paid over by the defendant), as well as penalties of $5,500 to $11,000 per false claim.

What is the purpose of the False Claims Act?

The purpose of the False Claims Act (FCA) is to combat fraud against the government and protect taxpayer funds. Enacted during the Civil War in 1863, the FCA was initially aimed at addressing fraudulent practices by companies selling supplies to the Union Army. Over time, its scope has expanded to cover a wide range of fraudulent activities involving government contracts, programs, and funds.

The FCA serves several key purposes:

  • Deter Fraud: By imposing severe penalties and treble damages on those found guilty of defrauding the government, the FCA acts as a powerful deterrent against fraudulent practices. The threat of potential legal action and financial consequences discourages individuals and entities from submitting false claims or engaging in dishonest practices.
  • Encourage Whistleblowing: The FCA incentivizes individuals with knowledge of fraudulent activities to come forward as whistleblowers. Whistleblowers, also known as qui tam relators, can file lawsuits on behalf of the government and receive a percentage of any recovered funds as a reward. This provision encourages individuals with insider information to expose fraud and protect the government’s interests.
  • Recover Misused Funds: The FCA allows the government to recover funds that have been fraudulently obtained or misspent. The treble damages provision ensures that those found guilty of fraud pay a significant penalty, effectively compensating the government for the losses incurred due to the fraudulent activities.
  • Enhance Government Oversight: By empowering private citizens to bring FCA cases, the law acts as a supplement to government enforcement efforts. Whistleblowers often have access to valuable information that government agencies might not have readily available. This cooperative approach enhances the government’s ability to identify and address fraudulent practices.

Overall, the False Claims Act plays a crucial role in safeguarding taxpayer dollars and promoting integrity in government programs and contracts. It holds wrongdoers accountable, protects whistleblowers, and helps maintain the public’s trust in the government’s ability to manage funds responsibly.

Whistleblower Protection and False Claims Act Cases

In addition to the government bringing a False Claims Act suit, private individuals can also bring cases under the False Claims Act if they have non-public information regarding false claims being submitted to the government, or of a person or entity that has an obligation to pay money to the government, and fails to do so. The private citizen who brings the suit on behalf of the government is known as a relator, and they are entitled to receive a portion of any recovery in the case — anywhere from 10% to 30% depending on the case, plus attorneys fees and costs.

False Claims Act cases can arise in many contexts, but typically involve the following areas:

  • False claims to Medicare and Medicaid;
  • The payment of kickbacks for the referral of business that will result in payments from the government;
  • False claims by defense and other contractors providing items and services to the government;
  • Failures to pay over taxes and other tariffs due to the government;
  • The off-label marketing of drugs and devices that result in claims for reimbursement being submitted to the government; and
  • Violations of the Foreign Corrupt Practices Act involving the payment of kickbacks to foreign governments in connection with the providing of items or services to those governments.

In addition to the Federal False Claims Act, there are separate whistleblower statutes that allow for the whistleblower to receive a bounty in connection with income tax evasion and securities fraud.

There are provisions in federal and state law that protect whistleblowers, including civil and criminal sanctions if retaliation is taken against the whistleblower.

Contact Nicholson & Eastin

The False Claims Act empowers private individuals to act as watchdogs against fraud targeting the government, incentivizing them with rewards and protections. Whistleblowers play a critical role in preserving the integrity of government programs and contracts. If you have concerns related to a False Claims Act matter, our team is here to assist you. We offer flexible scheduling, including evening and weekend appointments, to ensure you receive the support you need. Contact us today to take a stand against fraud and protect government funds.

If you need assistance with a False Claims Act matter, please contact us. We provide evening and weekend appointments.


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