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Government Fraud Recoveries Would Make "Honest Abe" Proud

This is a black and white photograph of Abraham Lincoln.

Last week, the Department of Justice (DOJ) announced its annual False Claims Act (FCA) recovery statistics. According to Acting Associate Attorney General Tony West, in fiscal year 2012, DOJ’s Civil Division recovered nearly $5 billion ($4.959 billion) in settlements and judgments under the FCA, exceeding the previous one-year record by $1.7 billion. The total includes $3 billion recovered in health care fraud cases and $1.4 billion recovered in housing and mortgage-related cases.

The total amount recovered under the FCA since 1986, when the law was substantially strengthened by amendments sponsored by Senator Chuck Grassley (R-Iowa) and Representative Howard Berman (D-Calif.), now stands at $35 billion.

Some of the more notable FCA recoveries during FY 2012:

  • GlaxoSmithKline: $3 billion settlement of investigations into its drug marketing and Medicaid pricing practices
  • Merck: $950 million civil-criminal settlement related to the promotion and marketing of its Vioxx pain medication
  • McKesson: $341 million federal-state settlement of allegations that it defrauded Medicaid by inflating the prices of its drugs
  • Deutsche Bank: $202.3 million mortgage fraud settlement
  • ATK Launch Systems: $37 million settlement of a whistleblower lawsuit alleging the company sold defective flares to the U.S. Army and Air Force
  • Maersk Line Limited: $31.9 million settlement of claims that it overcharged on contracts to transport cargo to U.S. troops in Afghanistan and Iraq

The Project On Government Oversight’s Federal Contractor Misconduct Database currently contains at least 185 False Claims Act instances, accounting for more than $9.3 billion in fines, penalties, and settlements since 1995.

The variety of claims covered in the above cases attests to the FCA’s versatility and far-reaching impact. As Principal Deputy Assistant Attorney General Stuart Delery explained at last week’s announcement:

[F]raud against the government is not just a problem that affects us as taxpayers. It is a problem that affects us as parents and as patients. It puts service members and law enforcement officers at risk. It is an epidemic that plagues every aspect of our daily lives.

The FCA—also known as the “Lincoln Law”—was enacted to address contracting corruption during the American Civil War. Next year will mark its 150th anniversary.

By: Neil Gordon
Investigator, POGO

Neil Gordon, Investigator Neil Gordon is an investigator for the Project On Government Oversight. Neil investigates and maintains POGO's Federal Contractor Misconduct Database.

Topics: Contract Oversight

Related Content: Contractor Accountability, False Claims Act

Authors: Neil Gordon

Submitted by Susan Chandler at: December 15, 2012
The Justice Department declined to participate in many legitimate Qui Tam lawsuits, despite the courts increasingly attempting to freeze out Pro Se litigants as "incompetent" to address government matters. The recoveries could and should have been far greater. Pro Se Qui Tam suits must be defended as a reasonable form of seeking relief and redress. There are many shady government activities that no attorney will address on a litigant's behalf ... like the IRS Oversight Board's renewing every Bar association tax exemption despite it being blatantly obvious that the Bar protects its members ahead of the public, to the point of allowing decades of serial prosecutorial misconduct that puts innocents behind bars while actual criminals find new victims, as best addressed on the innocents' behalves by Dallas County, Texas and as worst addressed by Brevard County, Florida. (all per TIGTA complaint number 55-1106-0136-C)
Submitted by US Citizen at: December 15, 2012
When is HALIBURTON going to pay!!!!
Submitted by Senior at: December 15, 2012
And then they want to stiffle the whistle blowers
Submitted by Dfens at: December 13, 2012
Wow, $9.3 billion in fines over 20 years. In the same amount of time, the Joint Strike Fighter program has wasted $60 billion. That's just one program and it has wasted nearly an order of magnitude more of the US taxpayer's money.

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