Pres. Obama Strengthens False Claims Act

Chuck Mullins, a partner at Coxwell and Associates, handles false claims act cases, also known as qui tam cases or whistleblower cases, in Jackson, Hinds County, Mississippi and all over the state. President Barack Obama recently strengthened the False Claims Act. Here is the article:

President Barack Obama has signed into law the Fraud Enforcement and Recovery Act (FERA), strengthening the ability of the Federal Government to go after fraudulent contractors.
President Barack Obama has signed into law the Fraud Enforcement and Recovery Act (FERA) which will strengthen the ability of the Federal Government to go after fraudulent contractors.
“At a time when U.S. Government is spending hundreds of billions of dollars to jump start the economy, this legislation is a welcome first step to reassuring taxpayers that there will be zero tolerance for fraud” said Jeb White, President of Taxpayers Against Fraud.

FERA sailed through the House and Senate by overwhelming majorities, and represents the first significant amendment to the False Claims Act in nearly 25 years.

By attaching liability to contractors who wrongfully retain overpayments this bill ends the “finders keepers” era, while clarifying the fact that the False Claims Act covers all government funds, including those flowing to subcontractors. The law would also provide new fraud-fighting investigative tools to the U.S. Department of Justice.

With Troubled Asset Relief Program (TARP) and stimulus funds clearly vulnerable to fraud, this legislation could not come at a more critical time. The U.S. Government Accountability Office estimates that scores of billions of dollars are already being stolen every year from Medicare, Medicaid, Homeland Security, major infrastructure projects, and contractors working in Iraq and Afghanistan.

The False Claims Act works by incentivizing whistleblowers to come forward and partner with the U.S. Government to recover stolen money. The cost of investigations and prosecutions, as well as whistleblower awards, are funded by triple damage penalties which work to penalize companies above and beyond the cost of doing business. The Act has recovered nearly $24 billion since it was last amended in 1986.

Disclaimer: This blog is intended as general information purposes only, and is not a substitute for legal advice. Anyone with a legal problem should consult a lawyer immediately.

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