False Claims Act

The original federal False Claims Acts was passed by Abraham Lincoln and the Civil War Congress, to enlist citizen whistleblowers in the fight against fraudulent war industry profiteers. It empowers citizens by giving them a reward, and substantial legal rights against retaliation by employers.

In its present form, the government and whistleblowers can recover up to three times the amount of the fraud, plus substantial penalties and attorney fees. Whistleblowers (who are called “relators” under the law) may recover from 15% to 30% of the amounts collected from the frauding corporation. At least 22 states have passed their own similar false claims acts, and many other states are in the process. The government has recovered billions of dollars against frauding corporations, especially since the 1986 amendments to the federal law. Medicaid and Medicare fraud, along with military contracting fraud, are the largest areas for recoveries, but ethical citizens have exposed fraud in the education, environmental, and transportation fields and nearly all other areas of federal spending.