What are some common areas of fraud that are prosecuted under the False Claims Act?
It is impossible to predict all of the various ways fraudsters can and will cheat the Federal Government. However, here are some common areas of fraud prosecuted under the False Claims Act each year.
Procurement is the process by which the Federal Government buys all of the goods and services it needs to conduct its business. The Federal Governments procures everything from office supplies to military equipment.
Dishonest contractors violate the False Claims Act when they cheat the Government in the procurement process. Common procurement fraud schemes include billing for goods and services that were never delivered, over-billing for goods and services, falsifying invoices, winning a procurement contract by way of a bribe, and knowingly delivering substandard, defective or non-conforming goods.
The Federal Governments pays billions of dollars each year to healthcare providers through the Medicare and Medicaid programs. Medicare is a federal program that provides health care to the elderly. Medicaid is a joint federal and state program that provides health care to the poor and disadvantaged.
To qualify for government funds, healthcare providers must conform to important federal laws governing healthcare services, including the Stark Law and the Anti-kickback Law, both designed to ensure that healthcare providers make referrals that serve the best interest of their patients, rather than the best interest of the providers’ own wallets. When healthcare providers violate the Stark and Anti-kickback laws, they commit fraud.
Healthcare providers also committed fraud by engaging in bogus and dishonest billing schemes. These might include billing for services never performed, performing medically unnecessary procedures in order to generate billing, or manipulating CPT codes in order to fraudulently maximize billing.
Set Aside Contract Fraud
Doing business with the Federal Government can be very profitable. Each year, the Federal Government reserves a certain number of contracts, for public policy reasons, to be awarded to disadvantaged groups, such as small businesses, minority-owned businesses, veteran-owned businesses, and service-disabled veteran-owned businesses. In order to qualify for these set-aside contracts, the contract applicant must meet the criteria for membership in the specific group for whom the contract is reserved.
Unfortunately, many fraudsters lie about their status in order to receive one these set-aside contracts. When a contractor lies about its status, or its ongoing right to receive a set-aside contract, this constitutes a fraud on the taxpayers and may form the basis of a False Claims Act case.
The Federal Government also spends billions of dollars in aid programs to help people attend colleges, universities and other higher education programs. Many for-profit colleges and institutions take advantage of these programs by committing various forms of fraud.
These frauds might include lying in order to become accredited, paying commissions, bonuses, or other incentives to professional recruiters to recruit students, or lying to the Federal Government about the qualifications of students to receive federal funds.
Please Note: McCabe Rabin, P.A. provides these FAQs for informational purposes only, and you should not interpret this information as legal advice. If you want advice as to how the law might apply to the specific facts and circumstances of your case, please contact one of our attorneys.