False Claims Act (“FCA”) is the government’s main vehicle to stem out fraud against government-funded programs as well as to protect whistleblowers who report such fraud. The FCA has state counterparts that enable similar enforcement on the state level. Whistleblowers must reasonably believe that their employer financially defrauded the government by overcharging, mischarging, or retaining payments after knowledge of such actions. Over the last decade, the FCA expanded its anti-retaliation provisions to increase its scope of protection. At the same time, courts have followed by interpreting the protections in a way that increasingly protects whistleblowers and clarify what constitutes “protected activity” under the FCA.
Under the FCA, a Judge is entitled to order the violating company to pay triple the actual damages that the jury finds. In addition to those damages, the FCA enables the Department of Justice (“DOJ”) to charge statutory penalties ranging from $10,957 to $21,916 per claim submitted in violation of the FCA. (Bipartisan Budget Act of 2015.) Accordingly, the whistleblower will receive approximately 15 to 25 percent of the total FCA recovery plus attorney’s fees.
As the main enforcer agency of the federal government, the DOJ analyzes the cases submitted by whistleblowers under the FCA. Then, the DOJ makes its recommendation as to whether it will prosecute (or intervene) or decline and allow the whistleblower to bring the complaint on the government’s behalf. Attorneys should be knowledgeable about the process and gauge the prospects of a solid case in order to best position the client in advance of a possible settlement.
The FCA is used to stem out fraud resulting from such actions as overbilling, misreporting staffing, and kickbacks. In many of our firm’s representative cases, companies were supposed to abide by state and federal guidelines and laws but chose to ignore them. These companies may have also billed for services that were not provided or submitted charges at an improperly higher rate of reimbursement for the services. Also, other examples included finding financial companies that illegally billed the government for substandard services and providing fraudulent certification. In other cases, the companies may have realized that they received credit from their services that they have to repay to the government, but the companies do not reimburse the government within the 60-day time-frame.
The Fraud Enforcement and Recovery Act in 2009 (“FERA”) enabled the FCA to protect both the employee as well as the contractor, agent or others associated who reported about the company’s violations or defrauding of the government.
The FCA has whistleblower anti-retaliation provisions. These provisions protect:
- internal reporting of fraudulent activity to a supervisor and the government;
- actions are taken to advance potential or actual qui tam actions; and
- steps toward mitigating or stopping fraudulent actions or FCA violations.
If you witness any potential FCA violations such as your company’s unlawful reimbursement requests to the government, the company not actually rendering work when reimbursement is received, or the company receiving and knowingly retaining an overpayment, we recommend that you immediately report such violations under the guidance of a competent attorney. In addition, if you were retaliated against for making such reports or assisting in the investigation of the report, you may also be entitled to protection against such retaliation.