It appears that the federal government is on track to receive record payouts this year in whistleblower lawsuits involving contractor fraud. Following a $2.2 billion payment in November by Johnson & Johnson for its off-label use of Risperdal and other drugs, the Department of Justice (DOJ) should collect more than $5 billion under the federal False Claims Act by the close of fiscal year 2014. That comes from a report by Patrick Burns, co-director of the nonprofit Taxpayers Against Fraud Education Fund.
While the amounts recovered may be a drop in the bucket, compared to what the government is owed — including some $300 billion in unpaid taxes — it’s still a significant increase over the $86 million the government collected in 1987. It was in 1987 when the DOJ decided to significantly boost payouts to whistleblowers in an effort to fight fraud. That year, 30 citizens filed cases qui tam and the results have been very good for us taxpayers.
In 2013, a record 753 suits were filed under the False Claims Act, making whistleblowers responsible for 89 percent of DOJ fraud cases filed that year. Health-care fraud currently makes up the bulk of DOJ’s cases, and whistleblowers receive 16 percent of the settlement amount, on average. This has helped the government collect $39 billion since 1987, which would be $55 billion if you include criminal fines. Thus far, whistleblowers have earned $4.3 billion, including $388 million in 2013.
Source: Karen Aho and Businessweek.com
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