Under The Federal False Claims Act A Citizen May

Under the Federal False Claims Act: A Citizen May… Blow the Whistle

The Federal False Claims Act (FCA), 31 U.S. Code § 3729 et seq., is a powerful tool designed to combat fraud against the government. It allows private citizens, known as relators, to bring lawsuits on behalf of the United States against individuals or entities who have submitted false or fraudulent claims for payment. This article explores the crucial role citizens play under the FCA, detailing what actions they may take, the potential rewards, and the significant legal considerations involved.

Who Can Bring a Qui Tam Action?

The FCA's qui tam provision, 31 U.S. Code § 3730(b), empowers private citizens to file qui tam lawsuits. This Latin term, meaning "who as well," reflects the dual nature of the action: the relator sues on behalf of the government, while also pursuing a share of any recovery. Essentially, a citizen may:

• Identify fraud: The first step is discovering evidence of fraudulent claims submitted to the government. This could involve any federal program, including Medicare, Medicaid, defense contracts, or grant programs.
• Investigate thoroughly: Gathering substantial evidence is paramount. This might include documents, emails, witness testimonies, and expert analysis. Thorough investigation minimizes the risk of dismissal and strengthens the case.
• File a sealed complaint: The relator initiates the process by filing a sealed complaint with the federal court, detailing the alleged fraud and providing supporting evidence. This ensures confidentiality while the government reviews the allegations.
• Government Intervention: The government has a period of time to investigate the claims. It can choose to intervene and prosecute the case itself, join the relator's suit, or decline to participate. Even if the government declines intervention, the relator can proceed with the case independently.

What Constitutes a False Claim?

The FCA defines a "false claim" broadly. A citizen may bring a case if they discover evidence suggesting:

• False statements: Submitting a claim containing false or fraudulent information, such as inflated billing, falsified records, or misrepresentation of services rendered.
• False records: Creating or using false records or statements to support a claim for payment.
• Conspiracy to defraud: Participating in a scheme or conspiracy to defraud the government.
• Improper billing: Overbilling, double billing, or billing for services not rendered.
• Kickbacks and bribes: Receiving or paying kickbacks or bribes to influence government decisions or secure contracts.
• Violations of the Anti-Kickback Statute: The Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving remuneration to induce or reward referrals for items or services covered by federal healthcare programs. A citizen may bring an FCA action if they discover violations.
• False certifications: Submitting certifications or statements that are false, such as certifying compliance with regulations when it is not true.

The Role of the Government

The government plays a critical role in FCA cases. Once the sealed complaint is filed, the Department of Justice (DOJ) has the opportunity to investigate the allegations. The government may:

• Intervene: The DOJ might decide to intervene and actively pursue the case alongside the relator. This often indicates strong confidence in the merits of the case.
• Decline to intervene: The government may decline intervention for various reasons, such as lack of resources, insufficient evidence, or conflicting priorities. This doesn't necessarily end the case; the relator can proceed independently.
• Settle: The government can negotiate settlements with defendants, even before filing suit. This saves the cost and time of litigation.

Rewards for Relators

Successful relators are entitled to a significant portion of the government's recovery. The FCA typically awards relators between 15% and 30% of the total amount recovered, depending on several factors, including the relator's contribution to the case and the complexity of the investigation. This significant financial incentive encourages individuals to come forward with information about fraud.

Potential Challenges and Risks

While the FCA offers significant rewards, it also presents challenges and risks for relators:

• High burden of proof: Relators must demonstrate clear and convincing evidence of fraud. This requires meticulous investigation and strong legal representation.
• Legal costs: Pursuing an FCA case can be expensive. Relators should anticipate significant legal fees, expert witness costs, and other expenses.
• Potential retaliation: Relators may face retaliation from their employers or other individuals involved in the alleged fraud. The FCA includes anti-retaliation provisions, but these protections are not foolproof.
• Case dismissal: The government may choose to dismiss the case, even if the relator has strong evidence.
• Complex litigation: FCA cases can be complex and lengthy, often involving multiple defendants and extensive discovery.

Protecting Relators: Anti-Retaliation Provisions

The FCA includes robust anti-retaliation provisions designed to protect relators from adverse employment actions or other forms of retaliation. These provisions are crucial because reporting fraud can often lead to conflicts with employers or colleagues. These protections may include:

• Reinstatement: If a relator is wrongfully terminated or demoted, the court may order reinstatement to their previous position.
• Back pay: The court may award back pay for lost wages and benefits.
• Compensatory damages: Relators may recover compensation for emotional distress, humiliation, and other damages resulting from retaliation.
• Punitive damages: In some cases, the court may award punitive damages to punish the retaliatory employer.

Ethical Considerations for Relators

Bringing an FCA case involves significant ethical considerations. Relators must ensure their actions are motivated by a genuine desire to combat fraud and protect taxpayer dollars. Considerations may include:

• Good faith: Relators must act in good faith and have a reasonable belief that fraud has occurred. Frivolous or malicious lawsuits are subject to sanctions.
• Disclosure of all relevant information: Relators must disclose all relevant information to the government, even if it is unfavorable to their case.
• Maintaining confidentiality: Relators must respect the confidentiality of sensitive information and comply with court orders regarding sealing and disclosure of documents.

Steps to Take if You Suspect Government Fraud

If you suspect fraud against the government, take the following steps:

1. Document everything: Keep detailed records of any evidence, including dates, times, names, and supporting documentation.
2. Consult with an attorney: An experienced FCA attorney can advise you on the legal requirements and potential risks involved in bringing a qui tam action.
3. Consider whistleblower protection: Familiarize yourself with the whistleblower protections afforded under the FCA and other relevant laws.
4. Evaluate the strength of your case: Carefully assess the evidence you have gathered and the potential for success before filing a complaint.

Conclusion

The Federal False Claims Act empowers private citizens to play a vital role in combating fraud against the government. While the process can be challenging and complex, the potential rewards and the satisfaction of protecting taxpayer dollars make it a powerful tool for those committed to upholding the integrity of government programs. Understanding the requirements, risks, and ethical considerations is crucial for anyone contemplating a qui tam action. Always consult with legal counsel to navigate the intricacies of the FCA and ensure compliance with all applicable laws and regulations. The information provided here is for educational purposes only and does not constitute legal advice.