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Managing the risk before a False Claims Act claim is made against you

To safeguard against any possible risk resulting from violation of the FCA, consider addressing through an insurance program.

By Katherine C. Tower, JD, MBA, RPLU | Updated on August 22, 2016
Insurance coverage, including but not limited to employment practices liability, directors and officers and errors and omissions may be available to pay for the defense of FCA claims and possibly pay for the settlement or judgment as well.

The False Claim Act (FCA) is the primary means to fight fraud perpetrated against the government. The FCA imposes civil and criminal liability for knowingly making a false or fraudulent claim to the United States for money or property; or to avoid an obligation to pay money (reverse false claim). 31 U.S.C. §§ 3279-3733.

Due to the emphasis on enforcement of the FCA, the U.S. Department of Justice (DOJ) reported that it recovered over $3.5 billion in settlements and judgments from claims arising under the FCA during fiscal year 2015. Since January 2009, the DOJ has recovered more than $26.4 billion. Whistleblowers alone filed 638 “qui tam” suits in 2015 and were awarded $597 million during the same period.).

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