False claims involve any fraudulent activity relating to a government program or contract. Federal and state laws penalize individuals and businesses for submitting, or causing someone else to submit, a false claim for payment. False claims laws can apply to any fraud involving the government except for tax fraud, which is explicitly excluded.

The most common instances of false claims involve overcharging the government for goods or services. Other Typical cases may involve the failure to properly test a product prior to delivery, which is later found to be defective. False claims traditionally involved federal Department of Defense contracts, though recently they have shifted to health care fraud, involving Medicare and other government health care programs.

False Claims Act

The False Claims Act contains a whistleblower provisions, known as "Qui tam". This allows citizens with evidence of fraud involving government contracts and programs to file a lawsuit. The lawsuits are intended to recover funds on behalf of the government, while the whistleblower is awarded a portion of the funds. A typical award to the whistleblower would be between 15 and 25 percent of the recovery.

Due to the whistleblower provisions, private citizens are given a strong incentive to stop fraud. It may also cause temptation to blow the whistle on fraud where none actually exists, in hopes of a payout.

Penalties for False Claims

Federal and state penalties for filing a false claim are very similar. In either case the business or individual that is found to have filed the false claim is liable for three times the amount of damages incurred through the fraud. Federal claims also assess civil penalties between $5,000 and $10,000 for each separate violation, while Massachusetts penalties range between $5,500 and $11,000.

Contact our Law Offices

The triple damages penalty involved in false claims cases can be devastating to businesses and individuals alike. If you find yourself accused of making false claims it is imperative that you fight the charges with an aggressive defense. Our Attorneys have a proven track record defending clients in complex financial matters. Contact a Boston false claims lawyer today.

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