Private companies have been fleecing the federal government since our country’s inception and it continues to be an epidemic today. The False Claims Act of 1863 is a law that allows private citizens to sue contractors who have defrauded the federal government.

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Defrauding The Federal Government

There’s a law that dates back all the way to 1863, called the False Claims Act, which allows private citizens to sue contractors who have defrauded the Federal Government. Basically, what the civil war era legislators understood was that it would take private citizens to sue these contractors on the government’s behalf in order to fight corruption. The government couldn’t do it alone.

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Common Cases of Fraud on the Federal Government

The False Claims Act applies to fraud on the Federal Government and has applications from A to Z. So, for example, it’s common for medical providers or doctors to over-bill on Medicare or Medicaid, or bill for services that weren’t provided. That’s a fraud on the Federal Government, and a private citizen that has original knowledge of that sort of fraud can bring a False Claims Act on the government’s behalf to collect on the damages that are suffered by the government in that situation.

There has been a rampant problem with private military contractors fleecing the Federal Government for work done in connection with the Iraq and Afghanistan wars. The False Claims Act also has applications in the home mortgage setting. What continues to be a problem as well, are private kickbacks in situations where contractors are providing some sort of compensation to a government decision maker in order to lure or secure Federal Government business contracts. That’s illegal, and a private citizen who knows about that can bring a False Claims Act to recover the damage to the government as a result of that private kickback scheme.

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Who Can File a False Claims Lawsuit?

Private companies have been fleecing the federal government since our country’s inception and it continues to be an epidemic today.

There’s a law that dates back all the way to 1863, called the False Claims Act, which allows private citizens to sue contractors who have defrauded the Federal Government. Basically, what the civil war era legislators understood was that it would take private citizens to sue these contractors on the government’s behalf in order to fight corruption. The government couldn’t do it alone.

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When does the Department of Justice Intervene?

These lawsuits need to essentially be parked for at least 60 days, while the Department of Justice is making a determination on whether or not it will intervene. Now, whether the Department of Justice intervenes or not, the relater will be able to pursue his or her own claim if the Department of Justice is not interested.

While the law does have its rigid requirements during the filing, there’s also some flexibility to it too.

For example, attorneys are given some pretty wide latitude about where to file the lawsuit, and those are important considerations because some courts are friendlier to Qui Tam or False Claims Act lawsuits than others. Similarly, there’s a six-year statute of limitation period. So, as long as the relater has filed this False Claims Act within six years of when the Federal Government fraud was completed it’s still timely and that’s a pretty long look back period.

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Common Cases of Fraud on the Federal Government

The False Claims Act applies to a fraud on the Federal Government and has applications from A to Z. So, for example, it’s common for medical providers or doctors to over-bill on Medicare or Medicaid, or bill for services that weren’t provided. That’s a fraud on the Federal Government, and a private citizen that has original knowledge of that sort of fraud can bring a False Claims Act on the government’s behalf to collect on the damages that are suffered by the government in that situation.

There has been a rampant problem with private military contractors fleecing the Federal Government for work done in connection with the Iraq and Afghanistan wars. The False Claims Act also has applications in the home mortgage setting. What continues to be a problem as well, are private kickbacks in situations where contractors are providing some sort of compensation to a government decision-maker in order to lure or secure Federal Government business contracts. That’s illegal, and a private citizen who knows about that can bring a False Claims Act to recover the damage on the government as a result of that private kickback scheme.

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Upside to Filing False Claims Act Lawsuits

While there is a huge upside to bringing False Claims Act lawsuits, someone who is considering doing so also has to confront the reality that these also can take a long time.

The Department of Justice can intervene and dictate the pace of how the lawsuit is progressing and often times it depends on what the company’s settlement posture is. But any relater that’s thinking about filing a False Claims Act has to understand that they have to be in it for the long haul.