The False Claims Act (FCA) is one, very powerful tool that whistleblowers have available to them. In recognition of National Whistleblower Day, here are 10 fun facts about the FCA.
WLC’s Whistleblower Day “Top Ten” FCA Fact List
From Ancient Rome to Lincoln’s Law: The concept of incentivizing private citizens to report fraud dates back to ancient Rome. Qui tam (meaning “in the name of the king”) actions were used to combat corruption. The federal FCA was enacted in 1863 during the Civil War. President Abraham Lincoln urged Congress to pass the FCA because unscrupulous contractors were selling the Union Army sick mules, faulty rifles, and rotten food. As a result, the FCA was nicknamed the “Lincoln Law” after President Abraham Lincoln.
Wide Scope: The FCA covers a broad range of fraudulent activities involving federal funds. Some examples include healthcare fraud, defense contracting fraud, grant fraud, and more. Most recoveries under the FCA come from healthcare fraud. Many cases involve Medicare fraud by pharmaceutical companies, hospitals, and other healthcare providers.
Seal Requirement: Qui tam complaints remain under seal while the government investigates the allegations without the defendant’s knowledge.
Whistleblower Rewards: The whistleblower, known as the relator, shares in the government’s monetary recovery. In addition, the FCA provides strong anti-retaliation protections for whistleblowers, allowing them to sue their employers if they face retaliation for their whistleblowing activities.
Significant Recoveries: The Department of Justice recovered $2.68 billion in 2023. Of that, 86% ($2.3 billion) resulted from qui tam whistleblower suits.
Significant Penalties and Triple Damages: The FCA provides that anyone who violates the law is liable for a civil penalty in addition to three times the damages suffered by the government. The FCA requires a penalty for each violation. The FCA penalty amount also increases with inflation each year. Currently, FCA penalties range as high as $27,894 per violation.
Record-Setting Settlements: Some of the largest settlements in FCA history involve pharmaceutical companies. For example, in 2012, GlaxoSmithKline paid $3 billion to resolve fraud allegations, the largest healthcare fraud settlement in U.S. history. Other significant settlements involved our clients’ cases against AmerisourceBergen Corp. ($885 million settlement), Amgen, Inc. ($762 million settlement) and Serono, Inc. ($704 million settlement).
Impact on Corporate Behavior: The FCA has led to major changes in corporate compliance programs. In fact, many companies have implemented rigorous internal controls and ethics training to avoid potential FCA liability.
Civil vs. Criminal: The FCA is a civil statute, meaning it imposes liability through financial penalties rather than criminal sanctions like imprisonment. However, FCA cases can lead to parallel criminal investigations and charges.
State-Level Versions: Many states have their own versions of the FCA, often modeled after the federal statute. The states’ statutes aim to combat fraud against state-funded programs, such as Medicaid.
We Help Whistleblowers Expose Fraud
The Whistleblower Law Collaborative LLC helps whistleblowers expose government fraud. It devotes its practice entirely to representing clients nationwide in bringing actions under the federal and state False Claims Acts and other whistleblower programs. If you are aware of fraud against the government, we urge you to contact us for a free, confidential, consultation.
