Defrauding The Public- Filing False Claims
From identity theft, telemarketing cons and internet scams
, Americans are more aware than ever of the dangers of fraud. However, there is one type of fraud that happens every day, to every taxpayer and to the tune of billions of dollars a year. Known as false claims, these cases involve individuals or companies who have systematically cheated the government out of taxpayer dollars, for which they did not provide tangible products or services.
The False Claims Act helps the government reclaim the stolen money and rewards the person who comes forward to report the fraud. In 2010, an estimated $3.1 billion in taxpayer money was recovered, thanks to whistleblowers protected under the False Claims Act. In fact, whistleblowers may sue companies on behalf of the government. If successful, the government receives three times the amount of the fraud. In turn, whistleblowers are entitled to 15-30% of the damages. The whistleblower often receives millions of dollars for reporting the fraud.
Approximately 80 percent of all fraud recoveries under the False Claims Act occur in health care, but significant amounts of fraud are also found in defense, education, transportation, and the oil and gas industries.
The following article offers overviews of some of the most common types of False Claims that lead to large awards.
Healthcare Fraud
Healthcare is the largest offender. Fraud against federal Medicaid and Medicare programs accounts for 80 percent of False Claims recoveries in 2010. Healthcare fraud is committed in a number of different ways, but some of the most common frauds include:
* Services Not Rendered: Making claims for procedures or tests that the patient did not receive.
* Ghost Patients: Making claims for a patient who does not exist.
* Up-Coding Services: Submitting a claim for a more serious and more expensive procedure than that which actually was performed.
* Bundling and Unbundling: Billing separately for procedures and tests that are less expensive when "bundled," which results in larger reimbursement than the group rate for these procedures.
* Lack of Medical Necessity: Submitting claims for procedures that were not medically necessary, under the pretense that they were.
If you have witnessed any of these offenses against the U.S. Government, you should call Hill-Boren for a confidential consultation.
Financial Industry Fraud
Some of the most common false claims in the financial (bank, insurance and mortgage companies) industry:
* Federal Bailout Program: Mis-using funds set aside under the 2008 Troubled Asset Relief Program, or TARP. This $700 billion dollar fund has been the target of false eligibility fraud, conflicts of interest, use of funds for personal financial gain and failure to comply with TARP regulations.
* Mortgage Fraud: Acquiring federal backing of mortgages through the Federal Housing Authority (FHA) by using false or forged information for borrowers.
* Fraud Impacting Government Pension Funds: Insider trading and securities fraud that affects government pension funds.
Disaster Relief Fraud
Massive government spending in response to natural disasters is often accompanied by widespread fraud, including:
* hundreds of thousands of dollars in hotel rooms for phantom victim
* inflated renovation costs
* billions spent on mobile homes that were never used
* millions for rental assistance by prisoners
* double charging for construction and renovation work
Government Contractors
In theory, the government should receive the best possible prices on goods and services. However, defense contractors have a long history of fraud against the taxpayers. This type of fraud is one of the most active areas of false claims litigation.
* Cross-Charging: Shifting costs from one project to another, in order to receive additional benefits.
* Improper Product Substitution: Supplying the government with a product that does not meet the standard required.
* Inflation of Costs and Charges: Inflating costs in order to increase the revenue earned on the project.
* Violations of the Truth-In-Negotiations Act: Inflating costs for contracts when that contractor is the only company which can provide the goods or service.
by: Robert Hill
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