President Obama Expands False Claims Act

President Barrack Obama recently signed the Fraud Enforcement and Recovery Act (FERA) of 2009, a law to reduce abuse in federal programs, into law. In doing so, he has also expanded the False Claims Act (FCA), a civil statute which allows private citizens to expose fraud against the government and share in the amounts collected.

FERA

The FERA was signed into law in May 2009 in order to prevent mortgage fraud and extends the FCA to include any false or fraudulent claim for government money or property, whether or not the claim is presented to a government official or employee, whether or not the government has physical custody of the money and whether or not the defendant specifically intended to defraud the government.

Qui Tam / Whistleblower Laws

The False Claims Act is also known as the Qui Tam statute, and more commonly as the whistleblower statute. FERA and changes to FCA include:

  • Amending the whistleblower protections to employees, contractors and agents who suffer employment retaliation for reporting FCA violations and makes it easier for those individuals to pursue retaliation claims;
  • Requiring those who violate the law to reimburse the federal government for the costs of the civil action;
  • Expanding the statute of limitation periods to give the government more time to decide whether or not it will intervene;
  • Broadening the attorney general's ability to issue document subpoenas and authority to share those documents;
  • Extending the law to apply to anyone who knowingly keeps a government overpayment without regard to whether or not the entity used a false claim to obtain the payment.

    Fraud cases increasing

    Qui Tam lawyers say that not only are the number of whistleblower cases is increasing, but also the dollar amounts of those awards. Here are examples of what was recovered in some recent cases:

  • Amerigroup: $334M
  • AstraZeneca: $355M
  • Bayer: $257M
  • Medco Health: $155M
  • NetApp, Inc.: $128 Million
  • Pfizer: $49M
  • Quest Diagnostics / Nichols Institute Diagnostics: $262 Million
  • Zyprexa: $1.4 Billion

    Whistleblowers, or relators, generally collect anywhere from 15% to 30% of what was recovered. Hiring a qui tam lawyer is encouraged to protect your rights and maximize your settlement.

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