THE PROJECT ON GOVERNMENT OVERSIGHT”
“It is a substantial increase over
last year’s total.
A large number of recoveries came from contract fraud cases involving
some of Uncle Sam’s most prominent suppliers of goods and services.
The
Justice Department announced
on Wednesday it had recovered for taxpayers more than $4.7 billion
through settlements and judgments from False Claims Act cases in fiscal
year 2016. According to the announcement, it is the third highest annual
recovery in False Claims Act history. It is also a substantial increase
over
last year’s total.
Of the $4.7 billion recovered, $2.5 billion came from health care
fraud cases. An additional $1.7 billion came from settlements and
judgments in cases alleging false claims in connection with federally
insured residential mortgages.
- Boeing:
$18 million to settle allegations that it overcharged the US Air Force
for aircraft maintenance services at Boeing’s Long Beach, California,
depot. (In 2014, Boeing paid $23 million for allegedly overcharging maintenance work at its depot in San Antonio, Texas.)
- Centerra Services International: $7.4 million to resolve a lawsuit accusing the company of overbilling the Army for firefighting services in the Middle East
- Computer Sciences Corporation:
$1.35 million for billing the Defense Information Systems Agency for
subcontract workers who lacked the required security clearances
- Deloitte Consulting LLP: $11.38 million to resolve overbilling claims on a General Services Administration contract
- DRS Technical Services: $1 million to settle charges that employees billed the Army for hours they did not work
- L-3 Communications: $25.6 million to settle claims of selling the government defective weapon sights
- Lockheed Martin:
$5 million for allegedly misleading federal and state regulators about
noncompliance with environmental regulations at the Paducah Gaseous
Diffusion Plant in Kentucky
- SRA International: $1.1 million for alleged false billing on military contracts
- United Technologies: $11 million in penalties, interest, and disgorgement of profits for overcharging the Air Force for jet engines in the 1980s
- URS Corporation:
$9 million to settle allegations that a subsidiary defrauded the
government into awarding it construction contracts that it was not
eligible to receive. In a different case, URS paid $580,000 for allegedly overbilling labor rates on a bridge reconstruction project.
The False Claims Act is the government’s primary tool to redress
fraud in the areas of health care, defense and national security, food
safety and inspection, federally insured loans and mortgages, highway
funds, small business contracts, agricultural subsidies, disaster
assistance, and import tariffs.
In 1986, Congress
strengthened the Act
by increasing incentives for whistleblowers to come forward with
allegations of fraud. Most false claims actions are filed by
whistleblowers in
qui tam lawsuits. Since 1986, the government has recovered
slightly over $53 billion, awarding more than $6.3 billion of that to the whistleblowers who filed the lawsuits—often at great risk to their careers.
On the same day the Justice Department announced its annual fraud recoveries, it also announced it had collected nearly
$15.4 billion in civil and criminal cases in FY 2016, one-third less than
last year’s total.
This amount includes recoveries in all civil and criminal enforcement
cases (including those involving the False Claims Act), fines imposed on
individuals and corporations for violations of federal financial,
health, safety, civil rights, and environmental laws, and collected
debts owed to the federal government.
How will the False Claims Act fare under the Trump administration? At least one expert foresees very little change.
Taxpayers Against Fraud acting president Patrick Burns
recently observed
that Senator Jeff Sessions (R-AL), President-elect Trump’s choice for
Attorney General, “has never winked at companies that harm American
workers and consumers” and “understand[s] the value of whistleblowers
and whistleblower laws when it comes to fighting corporate theft and
crony capitalism.” He noted that Sessions has supported strengthening
the False Claims Act and has a good relationship with Senator Chuck
Grassley (R-IA),
the law’s key champion in the Senate.
Burns’ prediction gives us hope that active enforcement of the False
Claims Act—and billions of dollars in annual recoveries—will continue
for years to come.”
http://www.pogo.org/blog/2016/12/federal-fraud-recoveries-fy-2016.html
