Columbus Regional explainer: What is the False Claims Act?

July 14, 2013 

What is the False Claims Act?

The False Claims Act is the government’s primary civil remedy to redress false claims for federal money or property, such as Medicare benefits, federal subsidies and loans and payments under contracts for goods and services. Amendments in 1986 strengthened the act and increased incentives for whistle-blowers to file lawsuits on behalf of the government, leading to more investigations and greater recoveries.

What is a qui tam action? In a qui tam action, a private party brings a suit on the government’s behalf. The government, not the private party, is considered the real plaintiff. If the government succeeds, the private party receives a share of the award. The federal False Claims Act authorizes qui tam actions against parties who have defrauded the federal government. If successful, a private party in a False Claims Act qui tam action may receive up to 30 percent of the government’s award.

Are qui tam actions common? In fiscal year 2012, which ended Sept. 30, 2012, whistle-blowers filed 647 qui tam suits. Of the $4.9 billion the Justice Department recovered from settlements and judgments in civil cases involving fraud against the government, a record $3.3 billion was recovered in the whistle-blower suits.

Sources: U.S. Department of Justice, Cornell University Law School

Click here to read Unsealed: Top administrator at Amos Cancer Center files federal court claim accusing the center of overbilling government insurers

Click here to read the timeline of events and how this story unfolded

Click here to read Richard Barker's amended claim

Click here to read Richard Barker's original claim

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