In recent years, cases alleging customs and tariff fraud have grown in number. This is due to both the increased use of tariffs as a policy tool of the United States government, as well as the increased knowledge among people working in the importing and logistics businesses about the availability of the False Claims Act as a tool they can use to help stop fraud and evasion.
Cybercrime is a rising concern both in the United States and worldwide. In order to address rising crime rates and costs of data breaches, governmental agencies are now empowered to respond with the full scope of the False Claims Act. Individual whistleblowers can now report cyber fraud under this federal legislation to help hold businesses that contract with the government accountable. This change better protects private data and helps prevents financial fraud.
By the end of FY 2020, the United States Securities and Exchange Commission (SEC) had awarded over $740 million to whistleblowers. By that same period, the Commodity Futures Trading Commission (CFTC) recovered nearly $1 billion for commodities-related fraud and paid whistleblowers more than $120 million. In FY 2022, the SEC awarded $229 million to whistleblowers in 103 awards, which was the second-highest amount the Commission has ever awarded to whistleblowers. For FY 2022 as well, the CFTC awarded approximately $200 million to a single whistleblower and about $11.5 million to 7 other whistleblowers.
Private companies authorized to sell goods and services to the government provide billions of dollars of critical infrastructure, equipment, expertise, and much more to support a wide range of government programs. Private contractors keep the government working and serving taxpayers every day. In this very competitive environment, the government contractor must execute their responsibilities without fraud, abuse, or misconduct. Otherwise, they may be held accountable via federal and state False Claims laws.
Healthcare fraud is a top priority of the United States Department of Justice’s enforcement efforts under the False Claims Act. Over a recent four-year period, 80% of the $11.4 billion recovered by the Department of Justice under the False Claims Act was in healthcare fraud cases. Those cases involved fraud in the Medicare, Medicaid and other taxpayer-funded healthcare programs. The primary way the Department of Justice uncovered the fraud that led to these recoveries was from reports by whistleblowers. Over that same four year period, whistleblowers received more than $1.54 billion as their share of these recoveries.
The False Claims Act applies to any government program that provides money to companies or people outside the government. In other parts of this website, we discuss how the False Claims Act applies to government-funded healthcare programs and government contracts, two significant examples of government programs covered by the Act.
Since 2007, the Internal Revenue Service’s Whistleblower Program has awarded whistleblowers more than $1 billion for helping the agency collect unpaid taxes. Whistleblower cases have led to the successful collection of $6.14 billion from non-compliant taxpayers.