The False Claims Act is among the oldest anti-fraud statutes in American law. President Lincoln signed it into law on March 2, 1863, in response to fraud by wartime contractors who sold the Union Army defective and substandard goods. The original statute imposed double damages and a $2,000 penalty per false claim; a 1986 amendment raised the multiplier to treble and substantially increased civil penalties.
Central to the law’s power is its qui tam provision, which allows private citizens to sue on the government’s behalf and collect a share of any recovery..
Healthcare fraud is the dominant category of False Claims Act litigation, encompassing billing schemes involving Medicare and Medicaid, kickback arrangements between providers and referral sources, and upcoding or billing for services never rendered. Defense and government procurement fraud constitutes another major category. Beyond those two traditional areas, the statute has been applied to a broad and growing range of conduct involving any federal funds, including pandemic relief fraud.
These trends are reflected in Docket Alarm data, analysis reveals. False Claims Act litigation – brought directly by the government, and by private citizens on behalf of the government – has risen steadily over time, but spiked in 2023.
Enforcement of the False Claims Act with regards to the COVID-19 pandemic’s Paycheck Protection Program system was on the rise. Analysis from Gibson Dunn reveals that enforcement in general government procurement increased as well.
The firm also noted that the Department of Justice began publicly crediting cooperators in False Claims Act cases, which may incentivize more filings.
Geographic data from Docket Alarm can reveal more. Nearly 700 cases have been filed in the Northern District of Mississippi since 2017, far more than any other state. These elevated case filings are largely responsible for the 2023 spike. A survey of these complaints confirms that many of them allege pandemic relief fraud.
Today, False Claims Act cases are at lower levels than 2023, but they remain at elevated levels compared to before and during the pandemic, reflecting a more aggressive enforcement posture and better incentives to file qui tam cases.
