The U.S. Department of Justice reported record False Claims Act numbers last month: $2.68 billion in recoveries from 543 settlements and judgments in the fiscal year ending September 30, 2023.
And for the second straight year, these record numbers show the importance of non-intervened whistleblower cases. Those are lawsuits filed by whistleblowers under the False Claims Act that federal prosecutors declined to intervene in, leaving the whistleblowers and their attorneys, like those at Keller Grover, to bring the case to trial and hold alleged fraudsters accountable without the help of the government.
In the last fiscal year, more than $2.3 billion of the False Claims Act recoveries — 86% — came from non-intervened cases.
“These numbers demonstrate the integral part that whistleblowers play in recovering federal funds lost to fraud,” said Jacklyn DeMar, President & CEO of the TAF Coalition. a non-profit organization dedicated to defending and empowering whistleblowers. Keller Grover whistleblower attorney Kate Scanlan is a member of TAF.
“As government expenditures have skyrocketed,” DeMar said, “so has fraud on government programs. We look forward to continue working with our government partners to fully unlock the potential of whistleblowers to protect taxpayer dollars and increase recoveries.”
Recoveries under the False Claims Act total more than $75 billion since 1986, when the FCA was significantly strengthened. When a FCA case is successful, the whistleblower typically receives a portion of the fraud recovered, ranging between 15% and 30%. In fiscal year 2023, the government paid $350 million to whistleblowers.
“The False Claims Act remains one of our most important tools for rooting out fraud, ensuring that public funds are spent properly, and safeguarding critical government programs,” Acting U.S. Associate Attorney General Mizer said.
The DOJ’s annual report highlighted several industries in which the FCA helps stop fraud and recover taxpayer money.
Health care fraud
Of the more than $2.68 billion in FCA settlements and judgments, more than $1.8 billion related to the health care industry, including fraud on the Medicare and Medicaid programs for drug pricing, unlawful kickbacks, billing for medically unnecessary services or substandard care. The Justice Department also intervened in cases where organizations participating in the Medicare Advantage (or Medicare Part C) program were alleged to have knowingly submitted inaccurate information about the health status of beneficiaries to increase reimbursement.
For example, The Cigna Group agreed to pay $172 million to resolve allegations that it knowingly submitted and failed to withdraw inaccurate and untruthful diagnosis codes for its Medicare Advantage Plan enrollees to increase its payments from Medicare.
COVID-related fraud
The DOJ continues to claw back improper payments made under the Paycheck Protection Program (PPP), an $813.7 billion program that provided fully guaranteed SBA loans for eligible small businesses, individuals, and nonprofits adversely impacted by the COVID-19 pandemic. In the last fiscal year, more than $48.3 million was recovered in connection with improper PPP loans.
Cybersecurity
The DOJ continued to pursue allegations under its Civil Cyber-Fraud Initiative, which holds government contractors and grantees accountable when they knowingly violate applicable cybersecurity requirements. Last year, Verizon Business Network Services LLC paid more than $4 million to settle allegations, and disclosed and remediated cybersecurity failures on contracts to provide trusted internet connections to the General Services Administration.
How we help whistleblowers
As the annual False Claims Act report shows, whistleblowers play a crucial role in exposing fraud in all layers of government programs. If you believe someone has engaged in fraud against the government, the whistleblower lawyers at Keller Grover can help you.
We provide confidential, free consultations to advise those who have observed suspected wrongdoing and can help you determine the best path forward from the very beginning, helping you minimize the impact of reporting, protect your rights and achieve the best possible outcome for your situation.