Bankruptcy Discharge of False Claims Act Debt
The U.S. Department of Justice (DOJ) has recovered billions of dollars from companies that do business with the government in civil cases involving fraudulent claims for reimbursement of services rendered to beneficiaries of federal programs pursuant to the False Claims Act, 31 U.S.C. § 3729 et seq. (FCA). It is expected that the DOJ will continue to recover billions each year in FCA cases. In May 2009, an Attorney General and Secretary of the Department of Health and Human Services interagency task force initiative, the Health Care Fraud Prevention and Enforcement Action Team (HEAT), was created to reduce and prevent Medicare and Medicaid financial fraud. From the institution of HEAT in 2009 until the end of 2015, the DOJ recovered $26.4 billion in cases involving false claims violations. Not only has the government consistently litigated FCA matters, the majority of monetary recoveries stem from qui tam cases filed by whistleblowers. In 2015, 638 lawsuits were filed by individuals on behalf of the government pursuant to the FCA, and $2.8 billion was recovered from lawsuits filed under the qui tam provisions of the FCA. From 2012 to 2015, the DOJ recovered more than $3.5 billion each year, and 2016 appears to be on track to exceed that threshold again.
