False Claims Act

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The False Claims Act (31 U.S.C. ยง 3729โ€“3733, also called the "Lincoln Law") is an American federal law that allows people who are not affiliated with the government to file actions against federal contractors they accuse of committing claims fraud against the government. The act of filing such actions is informally called "whistleblowing." Persons filing under the Act stand to receive a portion (usually about 15โ€“25 percent) of any recovered damages. The Act provides a legal tool to counteract fraudulent billings turned in to the federal government. Claims under the law have been filed by persons with insider knowledge of false claims that have typically involved health care, military, or other government spending programs. The government has recovered nearly $22 billion under the False Claims Act between 1987 (after the significant 1986 amendments) and 2008.[1]

Contents

History

The American Civil War (1861โ€“1865) was marked by fraud on all levels, both in the Union north and the Confederate south. During the war, unscrupulous contractors sold the Union Army decrepit horses and mules in ill health, faulty rifles and ammunition, and rancid rations and provisions, among other unscrupulous actions.[2] In response, Congress passed the False Claims Act on March 2, 1863.

Importantly, a reward was offered in what is called the "qui tam" provision, which permits citizens to sue on behalf of the government and be paid a percentage of the recovery. Qui tam is an abbreviated form of the Latin legal phrase qui tam pro domino rege quam pro se ipso in hac parte sequitur ("he who brings a case on behalf of our lord the King, as well as for himself") In a qui tam action, the citizen filing suit is called a "relator". As an exception to the general legal rule of standing, courts have held that qui tam relators are "partially assigned" a portion of the government's legal injury, thereby allowing relators to proceed with their suits.[3]

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