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The ABCs of the Federal False Claims Act

Federal False Claims Act

Federal False Claims ActIf you’re interested in learning more about the federal False Claims Act, here’s a brief summary of the history, rationale, process and rewards potential it affords individuals. While by no means comprehensive, this primer should provide you with insight into why the legislation was enacted, and why it continues to be an extremely effective tool for combating fraud.

The Origin of the False Claims Act

During the Civil War, Union Army suppliers were defrauding the government by providing substandard provisions, reselling the same goods and items back to the Army, and a host of other fraudulent activities impacting both troop morale and the government’s bottom line. In response, Congress enacted the federal False Claims Act in 1863.

The FCA provided grounds for fining and punishing any business or individual who knowingly submitted a false claim to the government. Since the original inception, the Act has been amended and strengthened several times in past 150+ years.

The False Claims Act Today

Under the False Claims Act, an individual has a right to file a qui tam lawsuit on the government’s behalf. Any individual with knowledge of fraud against the government can file.

The Department of Justice has recouped tens of billions of dollars in the past three years alone. Every single dollar recovered was the direct result of settlements and judgments issued in civil cases involving fraud and false claims. The two greatest areas of recovery are defense contractor fraud and healthcare fraud.

Filing a Qui Tam Claim

If you have evidence of a business or individual defrauding the government, you should consider filing a qui tam claim. Here’s a highly abbreviated version of each step in the process:

  1. Gather as much evidence as you can.
  2. Bring the evidence to an experienced qui tam law firm for evaluation.
  3. Determine how you’d like to proceed (gather more information, or begin the next step).
  4. Craft your complaint to the government.
  5. File the complaint in secret (called “under seal”).
  6. Assist the government with review of the complaint and provide any additional information to them as needed.
  7. Receive a decision from the government on whether or not they will intervene in the case.
    1. If they intervene: sit back and let them run the case through to completion.
    2. If they don’t intervene: determine whether you and your legal team want to take the case to court.
  8. Go to trial.
  9. Receive the Court’s
  10. Receive your reward from the recovered monies, issued at the sole discretion of the court.

Each of these steps is significantly more in-depth than what is captured here, but at a high level, you’ll need to go through each of these steps to reach completion.

Determining Your Reward in a Qui Tam Claim

If you happen to win your case, you are entitled to up to 30% of the monies recovered by the government as a result of the lawsuit. This amount can vary depending on a variety of factors including:

  • If the government intervened
  • If you designed the fraudulent scheme yourself
  • If you played a knowing part in any of the fraud
  • The amount of evidence you contributed or were able to gather
  • And more

You are also entitled to having your legal and court fees entirely covered by the defendant. In a successful case, you won’t end up paying a single dime out of your own pocket to cover any form of legal or court costs.

Have Additional Questions about the Federal False Claims Act?

Find out what you need to know about the federal False Claims Act by calling 770.643.1606 to reach our team at Bothwell Law Group today.