Liability

The False Claims Act, 31 U.S.C. §§ 3729-3733, provides liability for any person who:

(A) knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval;

(B) knowingly makes, uses, or causes to be made or used, a false record or statement material to a false or fraudulent claim;

(C) conspires to commit a violation of subparagraph (A), (B), (D), (E), (F), or (G);

(D) has possession, custody, or control of property or money used, or to be used, by the Government and knowingly delivers, or causes to be delivered, less than all of that money or property;

(E) is authorized to make or deliver a document certifying receipt of property used, or to be used, by the Government and, intending to defraud the Government, makes or delivers the receipt without completely knowing that the information on the receipt is true;

(F) knowingly buys, or receives as a pledge of an obligation or debt, public property from an officer or employee of the Government, or a member of the Armed Forces, who lawfully may not sell or pledge property; or

(G) knowingly makes, uses, or causes to be made or used, a false record or statement material to an obligation to pay or transmit money or property to the Government, or knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government.

Damages and Penalties

Those who violate the False Claims Act are liable for three times the government’s damages, plus a civil penalty of at least $5,500 for each false claim.

Qui Tam Action

The False Claims Act allows private persons to file suit for violations of the False Claims Act on behalf of the government. A suit filed by an individual on behalf of the government is known as a “qui tam” action, and the person bringing the action is referred to as a “Relator.”

Awards to the Relator

In the event of a successful qui tam action, the Relator is entitled to between 15% and 30% of the amount recovered by the government, plus legal fees and other expenses of the action.

Protections against Retaliation

The False Claims Act protects whistleblowers against retaliation for engaging in lawful acts done in furtherance of an action under the False Claims Act. An employer cannot retaliate against a whistleblower for engaging in protected activity to investigate the fraud and stop the violations.

Retaliation includes being “discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment because of lawful acts done” to report the fraud.