The United States Department of Justice (DOJ) announced that there will be increased penalties under the federal False Claims Act, is a powerful tool in the government’s war against fraud. As we have stated on numerous occasions, the False Claims Act incentivizes integrity by empowering ordinary citizens to blow the whistle on fraud committed against the United States government.
The text of the False Claims Act provided for penalties not less than $5,000 and not more than $10,000. The Department of Justice later increased that range to $5,500 to $11,000, and now the range has been adjusted once again. On May 2, the Department of Justice published the new penalty range for False Claims Act violations, which now provides for penalties not less than $10,781 and not more than $21,563. This new increase takes effect this year on August 1, and will last until Jan. 1, 2017. After Jan. 1, 2017, the penalties are indexed to increase annually to keep pace with inflation. These new penalties will be published in the Federal Register on an annual basis on or before Jan. 15 of each calendar year.
The False Claims Act is like a watchdog against fraud, and the penalties are the teeth. With these long-overdue penalty increases, the teeth are now twice as sharp as before. The new penalties serve to protect citizens and the government in three ways:
• First, there is a correlation between penalties and the tax pool. When an unscrupulous person or corporation defrauds the government, they steal from our tax pool. They are depleting monies gathered to fund our health care, our defense, and other benefits our tax dollars afford us. Higher penalties for committing fraud help replenish the tax pool.
• Second, these new penalties deter others from committing fraud against the government. Fraudulent acts committed many times over, such as improper billing, coding, or documenting of medical procedures, may result in penalties in the millions of dollars.
• Third, the False Claims Act provides incentives for citizens to step forward and blow the whistle on fraud. These incentives include 15 to 30 percent of the funds recovered by the government. Larger penalties equal larger rewards for whistleblowers. These larger rewards will incentive whistleblowers to remain vigilant, which is a win-win situation for taxpayers and the government. Whistleblowers receive larger rewards while the tax pool is more adequately recompensed.
If you are aware of fraud being committed against the federal government, or a state government, you should report it. The False Claims Act and other laws can protect and reward individuals for doing the right thing by reporting fraud. If you have any questions about whether you qualify as a whistleblower, or need more information about the FCA, you can contact a lawyer at Beasley Allen for a free and confidential evaluation of your potential claim. There is a contact form on our firm’s website, or you can email one of the lawyers on our whistleblower litigation team: Archie Grubb, Larry Golston, Lance Gould or Andrew Brashier at 800-898-2034 or by email at ArchieGrubb@beasleyallen.com, Larry.Golston@beasleyallen.com, Lance.Gould@beasleyallen.com or Andrew.Brashier@beasleyallen.com.
Contact us today for a free legal consultation with an experienced attorney.
Fields marked *may be required for submission.
If you would like to subscribe to the Jere Beasley Report digital edition, simply visit our Subscriptions page and provide the necessary information or call us at 800-898-2034.
Attorney Advertising - Prior results do not guarantee a similar outcome.