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False Claims Act 2008: D.O.J. Recovers $1.34 Billion

The Department of Justice has announced that the U.S. government recovered $1.34 billion in settlements and judgments under the federal False Claims Act for the fiscal year ending September 30, 2008. In its press release, DOJ emphasized that total recoveries under the Act since the 1986 amendments making it easier for whistleblowers to report and help prosecute fraud are now at more than $21 billion. http://www.usdoj.gov/opa/pr/2008/November/08-civ-992.html

The overwhelming majority of the money recovered in fiscal year 2008, approximately 78 per cent, was the direct result of suits initiated by private citizens in "qui tam" actions against corporations and individuals defrauding the federal government. The False Claims Act empowers insiders who are aware of corporate fraud against the government to file claims on behalf of the United States. These whistleblowers, known as "relators," file "qui tam" complaints in which they sue on behalf of the government and are entitled to recover between 15 and 25 per cent of the money recovered by the government if the government intervenes in the case, and 30 per cent if the government does not.

Most of the money recovered by the government in 2008, about 83.5%, came from allegations of health care fraud against government agencies, including Medicare, Medicaid, Tricare and the Federal Employees Health Benefits Programs. The government estimated that the total share going to whistleblowers for their efforts in fiscal 2008 was approximately $198 million.

The Department of Justice is conservative in its estimate of False Claims Act recoveries. If the DOJ included total state recoveries under state and federal False Claims Act cases for fiscal year 2008, the total amount recovered would be closer to $2 billion.

Keith CrossJoe Bennett
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